US unemployment figures have reached a five-year high on the 10th of March 2008. This has fueled apprehensions about an oncoming recession in the US economy. In an interlinked world economy this is expected to lead to a decline in US demand for Asian exports. Recession is essentially a slowing down of an economy. Asian stocks declined across the continent in response to the US unemployment statistics. At places local socio political factors coupled with the fear of recession plunged the Asian stocks down on 10th March 2008.
MSCI Asia Pacific in Tokyo has declined by 1.2% to 137.95 by mid-morning. Nikkei 225 average stood at 12,572.67 in Tokyo. It was a fall of 1.6 %. Topix was at 1,229.00 recording a decline of 1.5%. Platinum futures declined in February and stood at Y6, 707 per gram for delivery. This was influenced by the surging yen and a fast declining spot price.
Hang Seng index of Hong Kong at lunchbreak was at 22,159.04, a fall of 1.5 %. Mainland Chinese shares traded in the region as indicated by the relevant index was at 12,150.25 a loss of 3.6 %. Li & Fung declined 1.1% to HK$26.70. It supplies in bulk to Wal-Mart. Shares in Shanghai fell 2.6% to 4,190.25. China Railway Construction recorded a 27.8 % increase to Rmb11.60 on the first trading day. However, this was a modest figure as compared to the last 2 years.
Australia too was suffering from the paranoia of a US recession. The S&P/ASX 200 index in Sydney stood at 5,189.00 around early afternoon. That was a loss of 1.5 %. Indian stock market was also on a back foot on Monday. The BSE index slid 3.5% to 15,424 early in the day.
BHP Billiton the biggest global mining company declined 4.3 % and stood at A$37.22. It's arch business rival Rio Tinto was at A$125.73 suffering a 4.2 % fall. Australia's biggest steel maker BlueScope Steel fell by 3.2 % to A$10.07. ABC Learning Centres'shares were at A$1.57. It was a 6.8% addition after a recorded 1/3rd fall in the preceding week.
The Japanese shares caved in influenced by a rallying yen. The yen was close to an eight year high. On Monday the Japanese yen was going at Y102.27 as against the US dollar.
Malaysian shares were the worst hit ones in the Asian market. The market registered a fall of 7.7 %.
Here, political instability accentuated the losses. The ruling coalition suffered the greatest setback in over 4 decades. The weekend election saw the government keeping control of parliament but losing out on majority status, garnering less than 2/3rd of the votes polled.
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