HONG KONG, AFP
Asian stocks slumped on Tuesday, unnerved by the eurozone debt crisis, firing on the Korean peninsula and expectations that China will take further steps to rein in inflation. Hong Kong’s Hang Seng Index ended down 2.67 percent, or 627.88 points, at 22,896.14, as markets began to react to Tuesday’s artillery fire near the border between North and South Korea. Shanghai’s Composite Index closed down 1.94 percent, or 56.09 points, at 2,828.28, while Sydney’s S&P/ASX 200 index fell 1.17 percent, or 54.4 points, to 4,589.1. South Korea’s Kospi index fell just 0.79 percent, or 15.40 points, to 1,928.94, with Korean tensions likely to have more impact on Wednesday as the news broke close to the market close. Tokyo was closed for a holiday. Rob Ryan, a currency strategist at BNP Paribas Asia, told Dow Jones Newswires: “Any time shells fly through the air it’s not going to be positive (for) risk.” However, in Hong Kong, Francis Lun of Fulbright Securities was philosophical, saying: “Isn’t that the North Koreans’ usual tactic when they want something?” Markets were, in any case, weighed down by worries that the eurozone’s debt crisis may be far from over despite a bailout package stitched together for Ireland. “The market is just fatigued,” said RBS head of sales Justin Gallagher in Sydney. “Europe has been something of a time bomb for a while now and there’s still this undercurrent of structural issues that haven’t been dealt with,” he said, referring to fears that unresolved debt problems could pose a generalized threat to the eurozone. Traders also voiced worries about China and the likelihood of further measures to cool the economy, after Chinese authorities raised banks’ reserve requirement ratios last week. “The latest reserve requirement ratio hike isn’t enough to curb inflation,” said Zhuang Qianhua at Huatai Securities. Wall Street presented a mixed picture on Monday, with worries about Europe compounded by a vast insider-trading probe in the United States. The blue-chip Dow Jones Industrial Average closed down 0.22 percent, while the broader S&P 500 index fell 0.16 percent. However, the tech-rich Nasdaq was up 0.55 percent, boosted by an 8.9 percent rise in shares of subscription movie service Netflix. In other developments, New Zealand Oil and Gas, which holds almost a one-third stake in the Pike River coal mine where 29 men are missing after an explosion, saw its shares plummet 27.50 percent when a trading suspension was lifted. In Sydney, Qantas stocks rose slightly after the carrier announced it would begin flying its Airbus A380 superjumbos again from the weekend, after they were grounded for 19 days due to engine safety fears. Shares in Qantas closed up one cent at 2.64 Australian dollars. Gold closed at 1,363.00-1,364.00 U.S. dollars an ounce in Hong Kong, slightly up from Monday’s close of 1,361.00-1,362.00 dollars. In other markets:
— Manila fell 0.94 percent, or 39.54 points, to 4,147.35. — Wellington fell 1.16 percent, or 37.86 points, to 3,258.77 points. — Taipei fell 0.55 percent, or 46.28 points, to 8,328.63. — Jakarta fell 1.68 percent, or 63.04 points, to 3,678.19. — Singapore fell 2.02 percent, or 64.62 points, to 3,126.30. — Kuala Lumpur fell 1.04 percent, or 15.67 points, at 1,487.53. — Bangkok fell 0.95 percent, or 9.72 points, to 1,009.47. — Mumbai fell 1.33 percent, or 265.75 points, to 19,691.84.