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HONG KONG, Sept 18: Asian stocks closed sharply lower on Tuesday as fears of a global credit squeeze returned to haunt the markets ahead of a probable interest rate cut in the United States.
Investors were rattled by British mortgage lender Northern Rock which has endured a run on its branches over recent days since the Bank of England extended it a lifeline last Friday.
British finance minister Alistair Darling has also said the government would guarantee all savings held at the bank, seen as the latest victim in the subprime chaos that first erupted in the US in late July.
Subprime lending, loans made to risky clients, have raised fears of a credit crunch as borrowers struggle to meet debt obligations after a period of rising interest rates resulting in turmoil on international markets.
TOKYO: Japanese share prices slumped by more than two per cent as buyers took to the sidelines ahead of a key US interest rate decision.
Dealers said investors were also nervous about the fallout from a global credit squeeze after British lender Northern Rock was forced to seek a central bank bailout due to financial difficulties.
The Nikkei-225 index fell 325.62 points to 15,801.80. Turnover fell to 1.6 billion shares from 2.4 billion shares on Friday.
HONG KONG: Share prices closed little changed as gains in commodity stocks offset profit-taking in property ahead of the US Federal Reserve’s interest rate decision.
The Hang Seng index closed down 22.49 points at 24,576.85. Turnover was 80.50 billion Hong Kong dollars (10.3 billion US).
SYDNEY: Australian share prices fell 1.3 per cent amid ongoing uncertainty in the financial sector stemming from the global credit squeeze.
The SP/ASX 200 closed down 78.9 points at 6,192.5. Volume was 1.46 billion shares worth 6.81 billion dollars (5.7 billion US).
Reserve Bank of Australia governor Glenn Stevens assured investors that Australia and Asia were weathering the credit crunch as the market anticipated the US Federal Reserve would cut interest rates later Tuesday.
It is all about the Fed, how much they will cut, whether it ends in disappointment that it is too much or not enough, said Ric Klusman, head of institutional trading at Aequs Securities.
SINGAPORE: Share prices closed flat in cautious trade ahead of a key United States Federal Reserve policy meeting.
The Straits Times Index closed 1.44 points higher at 3,477.75 on volume of 1.88 billion shares worth 1.94 billion dollars (1.28 billion US).
KUALA LUMPUR: Malaysian share prices closed 0.1 per cent lower in cautious trade ahead of a key United States interest rate decision.
The composite index was down 1.01 points at 1,277.33 on volume of 779 million shares, valued at 1.3 billion ringgit (374 million dollars).
JAKARTA: Indonesian share prices ended 0.8 per cent higher in light trading as players stayed on the sidelines awaiting the outcome of a meeting of the US Federal Reserve policy meeting.
The composite index closed up 16.64 points at 2,239.86 on volume of 3.89 billion shares valued at 3.21 trillion rupiah (342.22 million dollars).
WELLINGTON: New Zealand share prices fell 1.08 per cent in line with overseas markets and amid renewed fears of a global credit squeeze.
The NZX-50 index fell 45.20 points to 4,123.52 on turnover worth 102.5 million dollars (72.1 million US).
MUMBAI: Indian share prices rose 1.06 per cent of a US Federal Reserve meeting to review interest rates.
Dealers said banking, consumer goods and oil stocks gained.
The 30-share Mumbai Sensex rose 164.69 points to 15,669.12.
The market will track the US Fed meet but political uncertainty and lower quarterly earnings growth may keep the markets rangebound, said Advait Date, a dealer with brokerage BHH Securities.—AFP
