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Asian stock markets fall again after Wall Street slump – live Asian stock markets fall again after Wall Street slump – live
(35 minutes later)
11.13am AEST02:13
It looks like a lot of volatility until the China market opens. Until then, perhaps we should have a quick look at the bigger picture, namely whether or not this market correction (let’s stick with that before we call it a crisis, or even a crash) means that the US Federal Reserve will still raise rates, as has been widely expected for months.
Former US treasury secretary Lawrence Summers is in no doubt, saying that raising rates soon would be a “serious error”. He said in an opinion piece for the Wall Street Journal:
A reasonable assessment of current conditions suggests that raising rates in the near future would be a serious error that would threaten all three of the Fed’s major objectives: price stability, full employment and financial stability.
11.04am AEST02:04
The ASX200 has gone into positive territory for the day helped by investors buying up bank stocks.
They have taken a fearsome beating in recent days – the financial sector was down 4.6% on Monday alone – so bargain hunters obviously think they’re now going cheap.
Investor champion Stephen Mayne clearly thinks so.
10.48am AEST01:48
Now it’s the turn of Japan’s economics minister Akira Amari. As we reported just a little earlier, investors are buying the yen as a safe-haven asset, bossting it to a seven-month high against the US dollar, which is not really what PM Shinzo Abe wants to happen.
However, Amari is putting some heroic spin on it. He says the buying shows Japan’s economic fundamentals are strong, Reuters reports. A bubble had formed in China’s stock market and that stock prices are now adjusting lower, he said.
And he added that it was up to the Bank of Japan to decide whether or not to ease monetary policy again – ie more QE to force the yen back down.
10.39am AEST01:3910.39am AEST01:39
The fightback is definitely on this morning. The ASX200 is now up 0.4%.The fightback is definitely on this morning. The ASX200 is now up 0.4%.
The Nikkei is still getting hammered though. Down 3.57% now.The Nikkei is still getting hammered though. Down 3.57% now.
China’s response/lack thereof now looks increasingly critical.China’s response/lack thereof now looks increasingly critical.
10.36am AEST01:3610.36am AEST01:36
Japan urges China to take actionJapan urges China to take action
The Japanese finance minister Taro Aso has urged China to do something to stop the bleeding.The Japanese finance minister Taro Aso has urged China to do something to stop the bleeding.
forexlive reports that Aso said:forexlive reports that Aso said:
Hope Chinese authorities take appropriate action to stabilise economy, which has big impact on global growth.Hope Chinese authorities take appropriate action to stabilise economy, which has big impact on global growth.
Recent yen moves are rough, rather than rapid.Recent yen moves are rough, rather than rapid.
He also said there are no plans for international coordinated action though.He also said there are no plans for international coordinated action though.
Hopefully we’ll get a proper version of his quotes soon where he doesn’t sound like a robot.Hopefully we’ll get a proper version of his quotes soon where he doesn’t sound like a robot.
10.26am AEST01:2610.26am AEST01:26
But check this out. The Kospi index in Seoul is UP UP UP. Amazing stuff – it’s risen 0.12%. The fightback starts here.But check this out. The Kospi index in Seoul is UP UP UP. Amazing stuff – it’s risen 0.12%. The fightback starts here.
10.26am AEST01:2610.26am AEST01:26
The Nikkei in Japan is down around 2%.The Nikkei in Japan is down around 2%.
10.21am AEST01:2110.21am AEST01:21
Or is the ASX rallying?Or is the ASX rallying?
Much will clearly depend on what happens when the Chinese market opens later on this morning – in fact, in a little more than an hour’s time. No sign yet of any policy moves by the People’s Bank of China.Much will clearly depend on what happens when the Chinese market opens later on this morning – in fact, in a little more than an hour’s time. No sign yet of any policy moves by the People’s Bank of China.
10.16am AEST01:1610.16am AEST01:16
More on Australia, where the exposure to China is acute.More on Australia, where the exposure to China is acute.
10.14am AEST01:1410.14am AEST01:14
ASX200 is tanking again in Australia. Now down 1.5% with all sectors taking a beating, says CommSec.ASX200 is tanking again in Australia. Now down 1.5% with all sectors taking a beating, says CommSec.
10.10am AEST01:1010.10am AEST01:10
Kospi down a little in Seoul.Kospi down a little in Seoul.
10.08am AEST01:0810.08am AEST01:08
Japanese and Australian markets open downJapanese and Australian markets open down
Not too bad in Australia – ASX200 down 0.6%. But Nikkei down 2.5% in Tokyo.Not too bad in Australia – ASX200 down 0.6%. But Nikkei down 2.5% in Tokyo.
10.03am AEST01:0310.03am 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.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.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.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.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 AEST01:0110.01am 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.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: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.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.”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.But he added that the authorities may hold such a meeting in future as needed.
9.55am AEST00:559.55am AEST00:55
Australian dollar falls to new six-year lowAustralian 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.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.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.The Aussie is down more 0.58% at US71.76c this morning after coming under pressure overnight.
9.50am AEST00:509.50am AEST00:50
'It’s a correction, not a crisis''It’s a correction, not a crisis'
More from Australian treasurer Joe Hockey, who says this is 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: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.”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”.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 AEST00:449.44am AEST00:44
How the Pink Un has called it today.How the Pink Un has called it today.
9.41am AEST00:419.41am AEST00:41
SUMMARY – a wild 24 hoursSUMMARY – 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 Weardenif 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.To summarise the summary, it was a bad day for the markets.
9.37am AEST00:379.37am 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?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: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.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.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.