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Asian stock markets braced for steep falls after Wall Street slump – live Asian stock markets braced for steep falls after Wall Street slump – live
(35 minutes later)
10.08am AEST01:08
Japanese and Australian markets open down
Not too bad in Australia – ASX200 down 0.6%. But Nikkei down 2.5% in Tokyo.
10.03am AEST01:03
Tom Phillips is on deck in Beijing and he sends us this from the Global Times, a Beijing-run tabloid, which blames western doomsayers for some of the problems.
There seems to be only one reason for the tumble – investors lack confidence in China’s economic outlook. The newly released economic figures do not look good. It seems that the words “misfortunes never come alone” have come true.
But the stridently nationalist paper, which is controlled by the Communist party’s mouthpiece paper, The People’s Daily, warned against paying too much attention to western doomsayers.
There is no need to worry because of pessimistic voices from the outside world. China’s economy is in a bitter period of structural adjustments. We should become inured to face all sorts of problems with grace. This temporary lack of confidence will not snowball to become destructive.
10.01am AEST01:01
The flip side of that is that other currencies seen as safe havens are doing much better. The yen, for example. That’s bad news for Japanese policymakers who want the yen to fall in value so its exports are cheaper.
Here’s Reuters:
A senior Japanese government official said on Tuesday that recent exchange-rate moves “appear to be rapid” after the yen surged to a seven-month high against the dollar as investors fled risk amid a global stock market rout.
Asked whether a meeting on market moves was planned on Tuesday among the ministry of finance, Bank of Japan and the financial services agency, the official told reporters: “There is no plan to hold one today.”
But he added that the authorities may hold such a meeting in future as needed.
9.55am AEST00:55
Australian dollar falls to new six-year low
I guess Hockey’s glass half-full view will be stress-tested a fair bit in the next few days. Very exciting stuff.
In the meantime, the Australian dollar – along with many other currencies exposed to the Chinese economy – is having a tough time.
The Aussie is down more 0.58% at US71.76c this morning after coming under pressure overnight.
9.50am AEST00:50
'It’s a correction, not a crisis'
More from Australian treasurer Joe Hockey, who says this is a correction, not a crisis.
Daniel Hurst has the full story here, but here’s another snippett:
He said countries did not have the same “firepower” – or the capacity to cut interest rates and engage in stimulatory spending – as they did at the onset of the global financial crisis in 2008, but added: “In fact there is no crisis now. It is a correction.”
Hockey said despite the falls, the Chinese stockmarket was still 40% higher than it was 12 months ago “and there has been a lot of flighty money in the Chinese stock market, so that’s part of the equation”.
9.44am AEST00:44
How the Pink Un has called it today.
9.41am AEST00:41
SUMMARY – a wild 24 hours
if you’re just joining the blog and you want a ctach up on the events of the past 24 hours, here it is courtesy of my colleague Graeme Wearden
To summarise the summary, it was a bad day for the markets.
9.37am AEST00:37
In Australia, the federal treasurer Joe Hockey has moved to reassure people that all’s well and that the country can withstand the market volatility. He also hinted that China will wheel out the big guns to try to stop the rot. Question is, what will they do – if anything?
Anyway, my colleague Daniel Hurst will be filing soon on what Hockey has said this morning. But here’s a snippett:
I’m absolutely confident, absolutely confident that the fundamentals of the Australian economy and the global economy are still good.
Last week, I met with one of the most senior economic figures in China.He reassured us, from his lips to our ears, that China would use whatever tools it has available to make sure that it grows relatively strongly this year ... There is no doubt.
9.31am AEST00:319.31am AEST00:31
9.27am AEST00:279.27am AEST00:27
The first key event of the day will be the opening across Asia and investors are expecting more steep falls. Futures are pointing to a 3.6% fall in the Australian market, taking the ASX200 well below 5,000 points.The first key event of the day will be the opening across Asia and investors are expecting more steep falls. Futures are pointing to a 3.6% fall in the Australian market, taking the ASX200 well below 5,000 points.
Chris Weston from IG Markets said this morning:Chris Weston from IG Markets said this morning:
The world’s capital markets are in meltdown, and investors are asking what can stop the panic. There is no getting away from the fact that this is going to be such a key session.The world’s capital markets are in meltdown, and investors are asking what can stop the panic. There is no getting away from the fact that this is going to be such a key session.
Our opening call is currently 4,820, which implies a 3.6% fall.Our opening call is currently 4,820, which implies a 3.6% fall.
9.23am AEST00:239.23am AEST00:23
Here we go againHere we go again
Good morning and welcome to the live blog on what promises to be another exciting day on the financial markets.Good morning and welcome to the live blog on what promises to be another exciting day on the financial markets.
After wild swings on Wall Street and Europe, it will be Asia’s turn again this morning, starting with Australia, Japan, South Korea, Taiwan and Malaysia at 10am Sydney time (midnight GMT).After wild swings on Wall Street and Europe, it will be Asia’s turn again this morning, starting with Australia, Japan, South Korea, Taiwan and Malaysia at 10am Sydney time (midnight GMT).
I’ll go through the main points in a minute but firstly a quick look at the scores on the doors, courtesy of Associated Press.I’ll go through the main points in a minute but firstly a quick look at the scores on the doors, courtesy of Associated Press.