Asia-Pacific, Europe equities fall on credit loss worries

Equities markets in the Asia-Pacific region were lower Thursday on fears that the falling dollar will hurt earnings at banks and for exporters as well as on continuing worries about the credit markets and losses there after an Amsterdam listed fund that belongs to the Carlyle Group became subject to seizure by its lenders after they could not come to an agreement following receipt of more than $400 million in margin calls by the fund.

Tokyo’s markets dropped after losses by one bank emphasized worries about writedowns related to mortgages and on fears that the falling dollar will erode exporters’ earnings there. The Nikkei 225 was down 3.33 percent to 12,433.44 while the Topix index fell 3.13 percent to 1,215.87 and the Mothers market dropped 1.63 percent to 603.01. Banks and exporters such as automobile manufacturers and the electronics sector saw declines, but the oil sector was higher on soaring crude oil prices.

Elsewhere in the region, Australian indices down, with the Sydney Ordinaries falling 2.22 percent to 5,215.7 and the S&P/ASX200 down 2.32 percent to 5,135.9. The Shanghai Composite was 2.43 percent lower to 3,971.26 while South Korea’s Kospi index dropped 2.6 percent to 1,6154.62. In Taiwan, the Taiex was down 2.66 percent to 8,210.99. The Straits Times Index was 3.85 percent lower to 2,805.55 while the Sensex fell 4.78 percent to 15,357.35. In Hong Kong, the Hang Seng dropped 4.79 percent to 22,301.64, with losses magnified by public fears that a flu outbreak there could spread.

Europe’s markets were also hurt by developments concerning the default by the Carlyle Group’s default on a mortgage bond fund. The pan-European FTSE Eurofirst 300 was 1.27 percent lower to 1,268.46. The IBEX dropped 0.44 percent in Madrid to 13,073.2 while the CAC-40 was down 1.42 percent to 4,630.19 and the Dax fell 1.5 percent to 6,500.56 in Frankfurt. The CAC-40 and the Dax each had only four winners, in the food and beverage, steel and utilities sector, among car and truck makers and in the pharmaceuticals sector. Biggest losers in Europe included banks and the semiconductors sector as well as among airlines, the aerospace sector and telecommunications groups.

In London, the FTSE 100 was 1.45 percent lower to 5,692.4 while the FTSE 250 dropped 1.88 percent to 9,801.5. The food and beverage sector was mixed. Banks were lower, as were property investors, miners, most insurers and retailers, and the construction sector.

Wall Street saw gains in early afternoon trade after the Dow Jones Industrial Average dropped over 220 points in morning trade. The gains came after markets were helped by a forecast from Standard & Poor’s that the end of mortgage and credit-related writedowns are in sight for large banks. However, it also upped its projection for total writedowns to $285 billion globally, from $265 billion. The Dow was up 0.26 percent at early afternoon to 12,141.26 while the Nasdaq Composite was 0.73 percent higher to 2,260.32 and the S&P 500 gained 0.43 percent to 1,314.42. Carmakers were lower after Morgan Stanley lowered its forecast of how many vehicles will be sold by the sector in 2008, while retailers declined on lower sales figures for February. House builders saw gains even though foreclosures were up 60 percent in Feburary.

Story link: Asia-Pacific, Europe equities fall on credit loss worries