Asian Stocks Plunge After U.S. Bailout Failure

Tokyo, Japan (AHN) - The record plunge of stocks on Wall Street saw Asian stocks falling sharply Tuesday, with some sliding up to 3 percent of their value after the massive U.S. $700 billion rescue plan failed to gain Congressional approval.

In a move seen to further push global economies into a slowdown, the U.S. House of Representatives pulled the plug on the $700 billion lifeline for the troubled U.S. financial system.

The rest of Asian major stocks were not spared by the Wall Street carnage, including popular stocks like Sony Corp. showing a 6.8 percent drop and Toyota Motor Corp. down 4.6 percent.

In Hong Kong, the Hang Seng index sank 3.6 percent. Markets in Australia, South Korea and the Philippines were also down sharply.

Japanese Prime Minister Taro Aso called on financial officials to closely monitor the development in the stock market and take appropriate actions to protect the economy from further downturn.

Investors across the globe reacted negatively when the U.S. Congress rejected the $700 billion plan of the Bush administration to rescue Wall Street by buying bad mortgages and other bad assets of troubled financial firms.

Many American lawmakers are afraid to back a measure that the majority of taxpayers do not want to bail out Wall Street's reckless investments made by over-paid CEOs.

Hong Kong's Hang Seng index was down 433 points, or 2.4 percent, while Australia and New Zealand saw similar losses, with the S&P/ASX-200 index shedding 3.5 percent in Sydney and a 3.4 percent fall in Wellington.

In Mumbai, the main Indian share index fell 3.3 percent in early trading.