Asian Stocks Slide as Markets Fret Over US Economy

TOKYO - Most Asian stocks fell sharply on Monday,Benchmarks also rose in Hong Kong. The Hang Seng
dragged down by heavy losses on Wall Street after aIndex edged up 17.09 points, or 0.07 percent, to close
surprise drop in US payrolls sparking fears the world'sbelow the 24,000 level at 23,999.70 Monday.
largest economy may be heading for recession,In Hong Kong most shares "were under selling
dealers said.pressure after Wall Street's sharp falls last Friday and
Investors are now pinning their hopes on a US Federalon concerns over the health of the US economy," said
Reserve interest rate cut to shield the economy fromKitty Chan, director at Celestial Asia Securities
the fallout from the housing slump, they added.Holdings.
Asian stocks suffered a heavy selloff after US and"US employment has been growing for the past four
European markets were rattled by news that the USyears so the fall was pretty scary," said Hirokazu Fujiki,
economy lost 4,000 payroll jobs in August, the firstequity strategist at Okasan Securities.
decline in four years and far below market"At the same time what is supporting stocks is
expectations.expectations for a cut to the Fed funds rate on
Adding to the jitters about the health of the globalSeptember 18. Investors are waiting ahead of
economy, Japan said its economy shrank by 0.3developments in the US. That's why there wasn't a
percent in the three months.shock selloff," he added.
The Nikkei 225 Stock Average closed down 357.19The Dow Jones index lost 1.9 percent Friday after
points or 2.2 percent at 15,764.97, with exporter sharesmarkets took fright at the drop in payroll jobs in the US
being particularly hard hit.economy.
Elsewhere, Seoul gave up 2.6 percent as the KOSPIThe report stoked fears of a US recession, despite
index closed down 49.03 points to 1,835.87. Manilaassurances from the Fed that the US economy was
declined 1.6 percent while Kuala Lumpur and Jakartaholding to a modest growth rate and that the slump in
both slid 1.4 percent.housing had been contained, dealers said.
However, Chinese stocks recovered from early"The US employment data reinforced investor
losses Monday.uncertainties about the future course of the US
The benchmark Shanghai Composite Index gainedeconomy on top of ongoing worries about subprime
78.11 points, or 1.5 percent, to 5,355.29. The Shenzhenloans," said Katsuhiko Hiroshige, a market analyst at
Composite Index rose 1.5 percent to 1,479.12.Traders & Co.
"Volatility in the market will likely be high onInvestors hope that the US can avert a recession if
expectations another interest rate hike may happen inthe Fed acts swiftly and aggressively to lower
coming weeks following the August consumer priceborrowing costs, which could help ease the US housing
figures," said Chen Huiqin, an analyst at Huataicrisis and the US credit squeeze. The federal funds
Securities.rate now stands at 5.25 percent.