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Asia stocks extend losses after Wall Street tumble (AP)
.
dropped less than 1 percent as the region posted its fourth day of losses, while European shares fell about 1 percent in early trade.
fell near $74 a barrel and the dollar was mixed against the yen and euro.
Investors continued to cut back their bets on stocks after U.S. markets tumbled Friday to their worst three-day showing since they hit bottom last March.
Uncertainty over the ultimate effects of U.S. President Barack Obama’s bank reform plan was cause for more caution, analysts said, as were worries about earnings results from American companies and rising opposition to
.
, investors already on edge about China’s economy and moves to prevent its overheating were further unnerved after
said it would seek to raise billions of dollars by issuing new equity and bonds. The move, designed to help the country’s third-biggest lender to replenish its capital and meet government standards, added to concerns about banks after a flood of lending to prop up the economy.
Clive McDonnell, head of Asia strategy at
, said the markets could trade lower for now unless Chinese policymakers expressed new confidence in the country’s growth or the U.S. clarified its banking proposal to calm investors. Still, he expected markets to bounce back.
“Sentiment is fairly poor at the moment,” said McDonnell, who is based in Singapore. “But I don’t see any of the fundamentals have changed whatsoever and I don’t think (stock) valuations are overly expensive. In our view, the markets are going to remain strong in 2010.”
As trading got under way in Europe, the
lost 1.1 percent,
fell 1 percent and France’s CAC-40 was off 0.7 percent. U.S. futures, however, pointed to a turnaround on
, with
gaining nearly 0.7 percent to 10,218 and
futures 0.7 percent at 1,098.
Earlier in Asia, Japan’s
stock average fell 77.86 points, or 0.7 percent, to 10,512.69, and
fell 127.63 points, or 0.6 percent, to 20,598.55.
Elsewhere, South Korea’s market dropped 14.15 points, or 0.8 percent, to 1,670.20. China’s Shanghai index lost 1.1 percent, Australia’s market was down 0.7 percent and India’s benchmark shed 0.3 percent.
’s move augured more efforts in the financial sector to raise capital by selling new shares, something that could weigh on stock prices. Bank of China fell 2.1 percent and
dropped 1.1 percent in
.
Friday in the U.S., the
slid 216 points, or 2.1 percent, to 10,172.98.
fell 24.72, or 2.2 percent, to 1,091.76. The index is down 5.1 percent in three days, its worst drop since March 2009.
lingered below $75 a barrel in Asia, with benchmark crude for March delivery down 25 cents to $74.29 a barrel. The contract lost $1.54 to settle at $74.54 on Friday.
The dollar weakened to 90.09 yen from 90.31 yen. The euro fell to $1.4143 from $1.4159.