Asian markets slump on fears over US Fed stimulus
HONG KONG: Asian markets dived Thursday, with Tokyo's Nikkei losing more than six percent at one point, and the dollar hit a two-month low against the yen on expectations that central banks' monetary easing measures will end soon.
Dealers ran for cover after a Wall Street sell-off, with the US Federal Reserve in focus before a policy meeting next week that many fear will herald the end of its $85 billion-a-month bond-buying.
Tokyo had slumped 4.61 percent in the afternoon, having crumbled 6.57 percent at one point in the morning.
Hong Kong had shed 2.68 percent by the break, Sydney fell 0.65 percent and Seoul skidded 1.03 percent.
Shanghai tumbled 3.08 percent in the first session back since weak trade and investment data at the weekend reinforced fears about a slowdown in the world's number two economy.
There were also big losses for markets in emerging economies, with foreigners removing cash they had invested on the back of the Fed's money-printing splurge as they sought better returns than in the West.
Manila, which last month sat at record highs, dived four percent, Bangkok tumbled 4.60 percent and Jakarta was 1.54 percent lower.
Sentiment has been battered this week after Japan's central bank held off unveiling any new monetary easing measures.
It also reignited traders' fears, which have been growing for several weeks, about the so-called quantitative easing by the Fed as the US economy shows signs of improving.
Fed chief Ben Bernanke unveiled the scheme in September, saying the bank would continue to print money until the world's biggest economy was strong enough to stand on its own two feet.
Japanese stocks took the brunt of Thursday's heat as the yen extended its gains against the dollar.
