Asian Stocks Decline on recession Concerns (Bloomberg) (28-01-2008)

Jan. 28 (Bloomberg) -- Concern that the world’s two largest economies are slowing sent Asian stocks lower on Monday.

 The MSCI Asia Pacific Index lost 3.3 percent to 141.18 as of 3:33 p.m. in Tokyo, after a three-day rally that had yielded 10 percent. The benchmark has fallen 11 percent so far this year and volatility today jumped to 63, the highest since October 1998, according to Bloomberg data. About 16 stocks retreated for each that rose.

The Shanghai Composite plunged 7.19% to 4,419.29 in China, while Japan's Nikkei 225 Stock Average lost 4 percent to 13,087.91. Hong Kong's Hang Seng Index was tumbling by 6 percent in afternoon trade but eventually recovered to close down by 4.25% at 24,053.61. Benchmarks in other markets open for trading retreated. Australia is closed for a holiday.

Financial stocks were battered yet again and in Japan Mitsubishi UFJ, Japan's largest publicly traded bank, slid 5.3 percent to 985 yen. Sumitomo Mitsui Financial Group Inc., the second-biggest, dropped 5.3 percent to 799,000 yen, while Mizuho was also down by 3.93% to 489.000.

Elsewhere in the region, Kookmin Bank, South Korea's largest, fell 4.3 percent to 59,700 won. HSBC Holdings Plc, Europe's No. 1 bank by market value, slipped 3.7 percent to HK$116.10 in Hong Kong. It is believed that bank earning will continue to reveal the extent of the problem, while the end is still not in sight.

In other sectors, Nippon Steel Corp. dropped 7.7 percent to 639 yen after the world's second-biggest steelmaker said net income for the three months ended Dec. 31 fell 13 percent from a year earlier as costs for shipping, iron ore and other materials rose.

JFE Holdings Inc., Japan's second-biggest steelmaker, lost 7.1 percent to 5,120 yen, while Sumitomo Metal Industries Ltd., the No. 3, slipped 4.4 percent to 506 yen.

Datang Power, China's largest power producer by market value, plunged 8.6 percent to 17.65 yuan, poised for its lowest close since Dec. 25. China Yangtze Power Co., the operator of the world's largest hydropower project, lost 4.5 percent to 17.15 yuan, while GD Power Development Co., northeastern China's largest electricity producer, dropped 6.3 percent to 14.50 yuan.

Source: Bloomberg