Asian stock markets sags as doubts mount about strength of US economic recovery

TOKYO – Asian stock markets sank Thursday after a torrid session on Wall Street triggered by jitters the recovery in the world’s No. 1 economy is weakening.

KEEPING SCORE: Tokyo’s Nikkei 225 dived 2.2 per cent to 14,736.90 as the dollar tumbled against the yen. South Korea’s Kospi lost 0.6 per cent to 1,915.13. Hong Kong’s Hang Seng dropped 0.9 per cent to 22,929.06 and Australia’s S&P/ASX 200 shed 0.6 per cent to 5,213.10. China’s Shanghai Composite Index was little changed at 2,374.45.

ANALYST TAKE: “Traders might be counting on a rebound in the Dow tonight after five straight sessions of losses which has eroded nearly 1,000 points on the Dow,” said Desmond Chua, analyst at CMC Markets in Hong Kong. “The greenback fell steeply against the majors following weak data which suggests the global slowdown is taking its toll on the largest economy in the world.”

CURRENCIES: The dollar was trading at 106.10 yen, down from 107.03 yen late Wednesday. The euro rose to $1.2830 from $1.2655.

WALL STREET: U.S. retail sales contracted unexpectedly in September, suggesting demand in the world’s biggest economy is losing strength. Still, share prices pared some of their earlier losses with the Dow Jones industrial average closing down 1 per cent at 16,141.74. The Standard & Poor’s 500 fell 0.8 per cent to 1,862.49. The Nasdaq composite dropped 0.3 per cent to 4,215.32. But fears about the future were rampant, prodding traders to move into less risky U.S. government bonds, gold and cash.

EUROPE SAGS: France’s CAC 40 index sank 3.6 per cent and Germany’s DAX lost 2.9 per cent. Britain’s FTSE 100 fell 2.8 per cent. Fears are growing about the region relapsing into a recession.

ENERGY SLUMP: The price of oil continued to fall to new lows. Benchmark U.S. crude was down 85 cents at $80.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 6 cents to close at $81.78 on Wednesday.