Singapore (AsiaNews/Agencies) - Asian stock markets closed lower, sliding by up to 6% or more, as investors fear a recession in the United States, the main customer for many of Asia's products.
In Singapore, the stock market closed 6.3% lower; the Nikkei index lost 3.9%; the Hang Seng closed down by 5.5% in Hong Kong.
Bank shares are among the hardest hit, through association with the U.S. banks in the grips of a crisis over subprime home mortgages.
China has also been hit hard. Many Chinese banks will be forced to reduce their lending margins in order to cover debts related to subprime mortgages. According to today's edition of the South China Morning Post, the Bank of China will have to spend at least 8 billion U.S. dollars to cover losses in the subprime market. Other lending institutions, like the Industrial and Commercial Bank of China and the China Construction Bank, have similar problems.
The Shanghai stock index today closed at its lowest level since December 19, with a fall of 5.14%; the Shanzhen index closed down 4.62%. Markets also closed lower in Thailand, Taiwan, South Korea (down 3%) and India (down 10.07%).
According to various analysts, the Asian markets are not confident in the plan launched last week by U.S. president George W. Bush, which would provide for a 140 billion dollar tax cut.
The state of the U.S. economy is very important for many Asian companies, as the United States is their biggest customer.