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Summary Safe havens were main beneficiaries with gold soaring, the yield on US bonds touching a new low.
Asian stock markets on Friday caught a global selling fever after new warnings of world recession and as fears grew over the future of European banks with heavy exposure to sovereign debt.Investors across the region picked up on the mounting anxiety evident in the United States and Europe, where the markets saw fresh carnage on Thursday.Safe havens were the main beneficiaries, with gold soaring and the yield on US 10-year Treasury bonds briefly touching a new low.Adding to woes in the region were fears that a slowdown in the galloping growth seen in China -- a key driver of the world economy -- could hit equities.Given the bloodbath seen across global equity markets overnight it is not at all surprising to see our market experiencing sharp and broad based losses, said IG Markets analyst Ben Potter in Australia, adding that there was no end in sight.From experience, these situations always go on for a lot longer than people think they should.Given the global financial crisis is still so fresh in peoples minds, the market is going to have to do a lot to win back the confidence of investors, especially the retail sector.Tokyo tumbled 2.51 percent, hit by the double-whammy of global fears and the persistently strong yen, with the headline Nikkei index at down 224.52 points to 8,719.24.Sydney shed 3.51 percent. The benchmark S&P/ASX 200 was down 149.3 points at 4,101.9.Seoul plunged 6.22 percent, with the benchmark KOSPI down 115.70 points at 1,744.88. South Korean exporters such as Samsung Electronics and Hyundai Motor bore the brunt of the losses.Hong Kong dropped 3.08 percent with the benchmark Hang Seng Index down 616.35 points to 19,399.92. Shanghai shed 0.98 percent, or 25.11 points, to finish at 2,534.36.The worldwide selloff came after Wall Street investment bank Morgan Stanley warned that the US and eurozone economies were dangerously close to a double-dip recession.Stocks were further punished by a fresh round of gloomy economic data from the United States such as jobless claims, and growing doubts about the ability of European banks to withstand the 17-nation eurozones debt crisis.The rout continued in European trade, with the continents main bourses all showing large losses in early trade.Londons FTSE 100 index of leading shares sank 3.07 percent to 4,935.73 points, Frankfurts DAX 30 index lost 4.41 percent to 5,355.79 points, and Pariss CAC 40 index showed a loss of 3.43 percent to 2,974.54 points.On Thursday the Dow Jones Industrial Average was down 3.7 percent at the closing bell, while the broader S&P 500 slumped 4.5 percent and the tech-heavy Nasdaq Composite plummeted 5.2 percent.Oil prices slumped as traders fretted that an economic downturn could erode global energy demand.New Yorks main contract, West Texas Intermediate light sweet crude for September delivery, dived $1.42 to $80.96 a barrel in afternoon Asian trade, while Brent North Sea crude for October dipped 79 cents to $106.20.
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