Asian markets decline on US financial worries (AP) (15-07-2008)

HONG KONG (AP) -- What seemed like a market booster initially did not help Asian stock markets either. Sharp drops were seen across the board on Tuesday as investor confidence in the U.S. financial system eroded.

Every major index was in the red by midday, with Hong Kong's Hang Seng Index dropping 3.2 percent and Taiwan's benchmark losing nearly 4 percent at one point.

In Tokyo, the Nikkei 225 index shed 2 percent to 12,750.10.

Banks were hit particularly hard as investors worried that trouble in the U.S. financial markets would spillover to Asia, after a sell-off of regional banks overnight on Wall Street, as well as fears that other American banks might face difficulties ahead. On Monday, the Dow Jones industrial average fell 45.35, or 0.41 percent, to 11,055.19 after spiking nearly 140 points in early trading.

In Japan, banking giant Mizuho Financial Group Inc.'s shares dipped 3.5 percent and Mitsubishi UFJ Financial Group Inc. was down nearly 4 percent.

Meanwhile, China's biggest lender, ICBC, dropped almost 5.1 percent in Hong Kong trading. China Construction Bank was off 4.9 percent.

China's most-watched index in Shanghai was off 2.5 percent. Elsewhere, South Korea's benchmark slid 2.6 percent, India's Sensex lost 2.3 percent and Australia's main index slipped 2.3 percent.

In currency trading, the dollar declined against the yen to 105.83. The greenback was flat against the euro.

 Source: AP