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Asian stocks fell the most since March, extending a global rout, and the region's bonds gained, while commodities dropped for an eighth day amid concern the U.S. economic recovery is petering out.
The MSCI Asia Pacific Index tumbled 3.8 percent at 12:41 p.m. in Tokyo, set for its largest weekly decline since October 2008. Standard & Poor's 500 futures slid 0.1 percent following yesterday's 4.8 percent slump. Japan's 10-year bond Yield sank to this year's low and the yen reversed earlier losses, a day after intervention by Japan. S&P's GSCI Index of raw materials was set for its longest decline since December 2008, paced by losses in oil, zinc and wheat.
More than $4.4 trillion have been wiped out from equity market values worldwide amid a sell-off that drove the MSCI All- Country World Index down more than 10 percent from this year's high into a so-called correction. The U.S. added 85,000 jobs last month, leaving the 9.2 percent unemployment rate unchanged, according to economists surveyed before data today that will cap a week of economic reports that showed the recovery is slowing.
"Investors are coming to grips with how dramatically the global and U.S. economies have slowed in recent months," Russ Koesterich, the San Francisco-based global chief investment strategist for the iShares unit of BlackRock Inc., said in a Bloomberg Television interview. His firm oversees $3.66 trillion as the world's largest asset manager. "What's really troubling investors is that given the fiscal austerity in Europe and the U.S. and the fact that interest rates are already at zero, it's not clear what steps governments can do to get us out of this."
Stocks Slump
Just 12 of the MSCI Asia Pacific Index's 1,018 members gained as the gauge extended its weekly loss to 8 percent. That will be the steepest one-week drop since October 2008, when credit markets froze following the bankruptcy of Lehman Brother Holdings Inc. a month earlier.
Japan's Nikkei 225 Stock Average sank 3.5 percent, Hong Kong's Hang Seng Index plunged 4.8 percent and Australia's S&P/ASX 200 Index slumped 4.1 percent. Benchmark indexes for South Korea and Taiwan as well as the MSCI Asia Pacific Index also entered corrections today. Hutchison Whampoa Ltd. (13), controlled by Hong Kong billionaire Li Ka-shing, dropped 8.5 percent after it reported first-half profit that missed analyst estimates.
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