May 7th, 2010
03:39 AM GMT
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“Hectic and confused.”

That’s how trader Tsutomu Yamada at kabu.com Securities Co. describes the morning session in Tokyo. Traders were still trying to understand what exactly happened on Wall Street, explained Yamada. The confusion over Wall Street’s plunge and concerns over a weakening euro drove the Nikkei down nearly four percent, ending the morning session down 3.74%. Exporters took the hardest hits, beginning with Nintendo dropping 11 percent on news its profits would decline more than expected.

Nikkei slide continues global sell-off

The sell off wasn’t limited to Japan: Look across the Asia Pacific region and the markets are down across the board.

Concerned, the Bank of Japan injected two trillion yen (US$20 billion) in short term lending Friday morning. A spokesperson with Japan’s central bank says “the aim is to increase a sense of security in the markets by providing ample funds.” Read here: Calm the market’s jittery nerves.

Yoshito Sengoku, Japan’s Minister in Charge of National Policy spoke to reporters Friday morning in Tokyo, saying that the Greece crisis will have a “limited impact on Asian economies.”

But Kirby Daley, senior strategist at Newedge Group in Hong Kong, believes that the market reaction to the Greece crisis is not a limited, knee-jerk reaction. “The drops will not likely be as violent as post-Lehman, but risk aversion is setting in for the long-term, as markets over-celebrated unsustainable stimulus. We may see some relief rallies, but the overall trend should now be firmly down for stocks,” said Daley.

Afternoon trading has begun again in Tokyo. Traders have had 90 minutes during the lunch break to catch their breaths here in Japan after the morning session. Fingers crossed, they say.

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soundoff (16 Responses)
  1. William Marlowe

    The world is teetering on fiancial monetary collapse, not just in Greece, Spain or Portugal but in the UK. As this article clearly points out the UK has greater defict problems then Greece and they pale in comparison to the US as everyone knows. We, the world are in very serious troubles as I pointed out in an iReport I published on April 29th predicting this ver situation. Read more of my post "We are Fuc*ed at ... 'http://www.ireport.com/docs/DOC-438226'

    May 7, 2010 at 5:09 am |
  2. Ash

    It is only a matter of time the world implodes into a non reversible financial and political crises in the making. Thanks to the nincompoops of Harvard and all the big colleges who thought they knew what they were doing. It is time to chop this tree and let something grow afresh.

    May 7, 2010 at 6:00 am |
  3. adam johnson

    The reason these countries in europe are having trouble with their debt isn't just because their is so much of it, its because they lack economic growth to support the debt, as is not the case in the USA, If you look at quarterly GDP the USA was only in the negative for a few quarters, with the worst of which seeing a 6.5% decrease, however, within months the GDP had a rally quarter of a 5.5% increase. As long as you can maintain growth of higher then 3% (which requires innovation and growing demographics) then you should be able to maintain the debt, though i agree they should cut a better handle on things in the west, need to cut all the BS programs.

    May 7, 2010 at 6:30 am |
  4. CC

    The rally shown by Dow Jones was ridiculous. There was no basis for it and still there isn't. You can't have a recovery with high unemployment.

    The sell off should continue. BTW, whats happening with oil ? Back to $80s. Thats another joke. It was a joke when it went upto $140. It was a joke when it fell to $40. Its still a joke. US government should regulate trading in oil. The demand is not that much to justify $80 a barrel. India and China combined account for only 13% of demand. 29% is from US and it fell in last 2 years.

    Thanks Goldman Sachs for trading in oil. Now when are you going to do that for coffee?

    May 7, 2010 at 7:07 am |
  5. longman

    Keep continue killing in the name of war on terror

    May 7, 2010 at 7:12 am |
  6. rovi

    Panic and Euphoria are often overdone. Does a crisis in the EU's smallest economy mean the world is at an end? Relax, turn away and come back in a few weeks. Or buy now.

    May 7, 2010 at 7:47 am |
  7. Manolis K.

    Wow ! I never thought that my small country (Greece) would cause Dow Jones to lose 1000 points in a matter of hours. Amazing ...

    I remember 10 years ago, Mega Money was after companies and their shareholders, today they are after countries and tax payers. Makes you wonder what a Nation, as we know it, is going to be in a few years.

    WW3, or World Financial War 1 to be exact, is in the making. The big bubble of unrealistic international debt, CDS, etc, has to go. A fact we all accept. To get there, most will loose and a few will profit enormously, naturally. When after a few years, world financial "peace" will be re-established, nothing will be the same again. By the way, WFW1 will end in ... China.

    Have a lovely day.

    PS. I am an economist, not a fortuneteller.

    May 7, 2010 at 9:35 am |
  8. Jeff

    Ahh, yes, the world is coming to an end. Again and again and again. Yet nothing is any different today than it was 2 months ago when everyone was buying, buying, buying. Now the savvy manipulators know it's a good time to drive down the market and cause some chaos while reaping a few extra billion out of the pockets of investors. Stir up some financial and media chaos, point to angry Greek crowds, then start massive selling of key stocks like Procter and Gamble to stir up the panic...hedge fund managers and small investors buy into the panic and dump their stocks well below market value to the savvy wall street system operators and manipulators.

    The so-called market "recovery" in 2009 is hardly an extreme when you realize the the collapse was so extremely exaggerated in the first place: precisely because people truly believed the economic world as we knew it was coming to an end.

    Obviously, that didn't happen. I'm still buying groceries, going to movies, the streets are still busy with people happily going about their business and not a thing has changed.

    Stop spreading panic, relax, and protect your investments by avoiding selling to the savvy manipulators for heavy discounts. In 30 days when this whole "crisis" is a distant memory, you will be glad that you didn't succumb to the hype.

    May 7, 2010 at 10:19 am |
  9. Chiangmai,thailand

    well,its time for those who greed!

    May 7, 2010 at 3:00 pm |
  10. Smith in Oregon

    Business 360, are the democracy's around the world based on the illusion of monetary worth? If so then if that currency is shown to be worthless then what happens to that democracy? This is being tested in Greece and could spread thru-out Europe and around the world as artificial worth of nations currency's are challenged and exposed as illusionary.

    This sudden 1,000 point drop in a 30 minute free fall in America's Wall Street DOW stock exchange appears to be a Red Flag event deliberately called on by a high ranking Federal Treasury official.

    This created emergency appears to have been used to discern the origins, groups and organizations who are using 'short' options and 'short' trading supercomputer algorithms to currently destroy Greece's economy, the Euro and now has Portugal, Italy and Spain in its gun sights.

    What I find amazing is the utter greed of these groups and investment organizations. As billions lost millions of dollars around the world, these groups and investment organizations pocketed Trillions and bankrupted entire nations in the process. Now they have Greece, Portugal, Spain and Italy in its gun sights as they further devalue the Euro weakening all of Europe in the process.

    Forced devaluation of a entire country's or nations currency by the insiders at the International Monetary Fund (IMF) is nothing new. On behalf of Bush sr. Panama's currency went to worthless as Bush sr. hoped that would cause Panama's people to toss out Noriega. On behalf of Bush jr. N. Korea's currency went to worthless as Bush jr. hoped that would cause N. Korea to stop it's Nuclear ambitions.

    Is the IMF behind the destruction of Greece's economy and the Euro?

    I do not believe it is, however with each successful campaign these nefarious investment organizations wages and nations destroyed, they are rapidly becoming as powerful if not more powerful than the entire IMF around the world. Both Bush's appear to have used the IMF for their corrupt and unethical political ends in literally blackmailing nations into their desired political direction.

    The concern the International and American public should have is 'what if any political agenda does these powerful investment organizations and firms has on the world stage'? They are certainly as powerful as the IMF blackmailing a Nation down a specific political direction as the Bush Family values previously noted. BUT WILL THEY?

    I do agree with a portion of the growing anarchists movement in Greece in their global view of the illusion that is dissolving democracy:

    In a democracy, Money is King and rules the growth and direction of democracy, laws and its lawmakers.

    When a nations currency is NOT backed by a solid commodity such as Gold, Silver, Land Standards on a 1:1 basis then that currency is entirely artificially inflated and has no inherent worth behind it.

    AND as the illusion of a nation's currency value is exposed, the Democracy that Nations currency supports and props up is exposed as artificially propped up as well, ethereal and based on illusion.

    May 7, 2010 at 11:39 pm |
  11. lisaweyn

    We are facing terrible economic times all over the world.

    May 9, 2010 at 1:06 am |
  12. Leo

    Speculators are calling the bears again...

    May 10, 2010 at 5:45 am |
  13. Smith in Oregon

    Wave after wave of investment firms and organizations buying Short on Greece's recovery was clearly pushing Greece into the abyss. I've commented the Red Flag dow jones event clearly appeared to be implemented by the US Treasury Dept. to uncover the origins, numbers and size of the investment firm systems shorting Greece into oblivion.

    With this transfusion of IMF funding into Greece, it's likely the same sharks in the tank will simply eat that up also.

    Goldman Sach's appears to be deeply involved in Greece's meltdown as it was in Iceland and many other country's whose national economy's dropped into the abyss.

    Goldman Sach's appears to have leveraged debt credit levels which in no realistic fashion had any real support behind that inflated value. And as Greece's debt load is collapsing there is nothing solid or meaningful to prop it up. So the IMF pour's in hundreds of Billions in a emergency effort to save Greece? I doubt the IMF is going to find any additional donors when the sharks circling Greece eat up this fresh meat cash transfusion.

    Perhaps the IMF emergency loan to Greece buys them some time, it remains to be seen however if Greece is able and even capable of successfully paying it's debt structure.

    May 10, 2010 at 7:50 pm |
  14. onno frowein

    The only reason that the dow went up is because the banks instantly secured their holdings in government bonds (Greece, Spain, Portugal and all other nations that borrowed heavily to pay for their bank debacles). However, people were not so sure that the EU/IMF injection of € 800 billion is going to stabilize the markets. It's only a temporary band-aid but again the banks used this opportunity to make hefty profits and as usual the people are going to hold the bag.

    May 11, 2010 at 4:45 am |
  15. karan bharadwaj

    yes and by this step taken by germany giving singal to world that europe all countrygoing into crisis

    May 19, 2010 at 4:14 pm |
  16. Astera

    This is all engineered to force the world into a one-world-government with one monetary system in which an ordinary citizen will have no say whatsoever. If we think that the current situation is bad – wait for a year or two to pass...

    May 28, 2010 at 10:19 am |

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