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Asian equities tumble on Europe debt crisis deadlock

25 Nov 2011 Evaluate

After yesterday’s rally, investment sentiments in Asian region vanished as all the Asian equity indices hammered badly in Friday’s session after German Chancellor Angela Merkel ruled out issuance of common euro bonds and a bigger role for the ECB to combat the worsening credit crisis in the euro area. European policymakers continue to struggle to break the current logjam over how to resolve the ongoing fiscal crisis, forcing investors to avoid risky assets. Fitch Ratings, citing Portugal’s large fiscal imbalances, its high indebtedness across all sectors and an adverse macroeconomic outlook, reduced the country's credit rating to BB+. That means Portugal is considered non-investment grade by Fitch, making it even more difficult for the struggling country to return to the bond markets. Adding to the pain was Hungary, which was downgraded to junk by Moody’s Investors Service late Thursday.

Meanwhile, Japan’s consumer prices fell for the first time in four months in October, an indication that slowing global demand and the yen’s strength are weighing on the world's third-biggest economy. Japan's core consumer price index fell 0.1% in October. Chinese shares ended down by 0.70 percent on Friday, weighed down by property and financial shares amid uncertainty over the timing of policy easing measures and volatility in global markets. While, Nikkei remained near two and a half year low as leaders were no closer to a consensus on how to contain the euro-zone debt crisis.

Asian Indices

Last Trade

Change in Points

Change in %

Shanghai Composite

2,380.22

-17.33

-0.72

Hang Seng

17,689.48

-245.62

-1.37

Jakarta Composite

3,637.19

-58.84

-1.59

KLSE Composite

1,431.55

-16.44

-1.14

Nikkei 225

8,160.01

-5.17

-0.06

Straits Times

2,643.93

-33.22

-1.24

Seoul Composite

1,776.40

-18.66

-1.04

Taiwan Weighted

6,784.52

-79.87

-1.16

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