Asian Shares Plunge Deep Into Red On Recession Fears

October 16, 2008 8:54 a.m. EST

Tokyo, Japan (AHN) - Shares in Asian markets plunged Thursday, led by Japan's benchmark index, on fears that authorities will not be able to avert recession with current measures.

Japan's Nikkei 225 average index tumbled over 11 percent in morning trading in Tokyo, which is the highest drop in almost two decades, led by exporters on weakening exports as consumer spending declines.

Oil futures remained closer to $70-a-barrel mark as a light sweet crude-futures barrel for November delivery moved down by $2.71 to $71.83 a barrel in Singapore's electronic trading on Thursday.

On Wednesday, the contract had finished $3.33, or 4.5 percent, to $71.23 a barrel overnight trading on the New York Mercantile Exchange.

In currency trading, the yen changed hands at 100.15 yen per U.S. dollar in Asia on Thursday, after it closed at 100.45 yen late Wednesday in New York.

In Japan, the Nikkei 225 average closed sharply lower by 1,089.02 points or 11.41 percent to 8,458.45 points, while the broader Topix index closed 9.5 percent down at 864.52 points.

The downward momentum in the shares was led by after investors were disappointed as Japanese authorities failed to take action along with other central banks. Shares of auto makers and other exporters gained.

Honda Motor Co., the country's one of the leading automakers, dropped by as much as 10.2 percent on cheaper fuel in Tokyo. Sony Corp. declined by 13 percent.

In Hong Kong, the Hang Seng closed lower by 767.78 points or 4.80 percent at 15,230.52 points, and the Hang Seng China Enterprises Index, also finished down by 6.7 percent to 7,363.39 points.

In Australia, the S&P/ASX 200 index also finished 6.7 percent lower to 4,013.40 points in Sydney led by major financial companies and resources of the country.

In the banking sector, shares of HSBC Holdings PLC, which got 26 percent of its 2007 revenue in North America, decreased by 2.9 percent in Hong Kong. National Australia Bank plunged by 4.3 percent.

In the mining sector, shares of BHP Billiton, the world's biggest miner, moved down by as much as 13.1 percent and Rio Tinto slipped by 16 percent. Woodside Petroleum dropped by 5.5 percent.

In China, the Shanghai Composite index remained volatile on Thursday and it finished by 4.3 percent lower at 1,909.941,69 points.

Elsewhere, South Korea's Kospi closed deep into red by 9.4 percent to 1,213.78 points in Seoul. Taiwan's Taiex index closed down by 3.3 percent to 5,075.97 points.