Another Tough Day

Another tough day for Asia's battered stock markets

Posted: 09 November 2007 1636 hrs

HONG KONG : Asian stocks had another wild ride Friday as investors wrestled with worries over the sub-prime loan crisis, but some markets managed to rebound into positive territory on bargain hunting.

It was a mixed picture across the region with Tokyo closing down 1.2 percent at the lowest level in almost three months, while Hong Kong managed to close flats after late buying.

Markets were licking their wounds a day after Thursday's brutal sell-off, with the mood still nervous after another tough day on Wall Street and a bleak message from US Federal Reserve chairman Ben Bernanke on the US economy.

The weakness of the greenback was also a concern as the euro hit a fresh record high of US$1.4738.

Shanghai, which has lost about one-tenth of its value in little more than a week, ended down 0.27 percent, while Singapore dropped 2.0 percent.

Investor fear that there might be further skeletons lurking in the closets of the world's major banks.

US giants Citigroup, Merrill Lynch and Morgan Stanley have already reported hefty losses on securities backed by sub-prime mortgages to homebuyers with patchy credit histories.

Wall Street saw another choppy session overnight, roiled by concerns about the credit squeeze, the weak dollar, high oil prices and a cautious outlook from technology giant Cisco Systems.

In his testimony to Congress Thursday, Bernanke focused on the downside risks to growth and expectations of a significant slowdown in the fourth quarter and into 2008.

Rising oil prices added to investor jitters, with New York light sweet crude futures up almost a dollar a barrel in late Asian trade.

Sydney was one of the bright spots, closing up 0.4 percent on news that the world's largest mining company BHP Billiton had made a bid for rival Rio Tinto to create a US$350 billion mining behemoth.

Elsewhere, Taipei ended 0.37 percent higher, Seoul added 0.6 percent, Manila climbed 0.3 percent, Bangkok advanced 0.11 percent and Jakarta was up 1.1 percent.

But Wellington fell 1.21 percent, Kuala Lumpur was off 0.8 percent.

Mumbai was closed for a holiday. - AFP/ch