Nikkei drops 11.4%, Hang Seng 8.5%, Kospi 9%, before slight recovery
HONG KONG (MarketWatch) -- Japanese shares plunged Friday, with the benchmark Nikkei 225 Average setting itself on course for the biggest one-day drop in more than two decades, as panic-stricken investors rushed to dump stocks across the board to raise cash.
At their lowest levels during the session, the Nikkei 225 Average tumbled as much as 11.4% in Tokyo and the Hang Seng Index lost 8.5% in Hong Kong, the Kospi index shed 9% in Seoul and India's Sensex slumped 9.6%, before recovering slightly. Elsewhere, Singapore's Straits Times index tumbled as much as 7.5% and Thailand's SET index gave up 8.2%, while China's Shanghai Composite lost as much as 5.4%.
"We have a complete market disarray, where valuations aren't even appropriate to mention," said Benjamin Collett, head of hedge-fund sales trading at Daiwa Securities SMBC.
"We've had a cascading series of events which have served to force equity holders to offload shares under a massive amount of distress," he said. "That means that they are selling at 15 to 30 cents on the dollar and there is no risk appetite or funding to allow someone to catch this drop."
The Nikkei, which had dropped as low as 8,115.41, a level it hasn't seen since May 2003, was recently down 10.3% at 8,211.38. The benchmark faced its worst single-day performance since the 1987 crash, according to reports. The broader Topix index fell 8.3% to 829.98.
The Hang Seng Index tumbled 7.5% to 14,755.94, while the Hang Seng China Enterprises Index slumped 8.6% to 7,076.50.
China's Shanghai Composite gave up 3.8% to 1,975.37, the Straits Times Index fell 6.7% to 1,961.72.
In Mumbai, the Sensex fell as low as 10,239.76 in early minutes of trading, before paring losses. The index was recently down 7.2% at 10,509.20.
Australia's S&P/ASX 200 fell 7.4% to 4,001.10, New Zealand's NZX 50 index gave up 4.6% to 2,809.45, South Korea's Kospi lost 7.1% to 1,202.91 and Thailand's SET Index lost 6.7% to 466.76.
The Taiwanese market was closed for a holiday.
"I think people are trying to liquidate positions, but there just aren't any buyers there. It's the nature of the markets that there are very few people willing to buy stocks," said Andrew Sullivan, a sales trader at Main First Securities. "A lot of people sitting on cash are happy to be sitting on cash at the moment."
Sullivan added the selling in Tokyo was likely intensified because of a holiday on Monday.
Regional detail
In Tokyo, banking giant Mizuho Financial Group , steelmaker JFE Holdings , shipping company Mitsui O.S.K. Lines , telecommunications major NTT DoCoMo , energy producer Inpex Holdings and auto major Honda Motor Co. were among those whose shares lost 10% or more during the session in the rush to offload equities.
An incessant flow of bad news about financial companies added to the fears. Earlier in the day, Japanese insurer Yamato Life Insurance Co. filed for bankruptcy protection from creditors, reportedly becoming the first in the industry to do so in seven years.
The slump in Tokyo forced the Tokyo Stock Exchange to suspend trading in futures and options of the Topix index for about 15 minutes, the Kyodo news agency reported.
In Sydney, shares of BHP Billiton fell 8.2% and Commonwealth Bank of Australia lost 5.9%. In Seoul, shares of Korea Exchange Bank slid 10%, while Posco ) slumped 8.3%.
In Hong Kong, shares of market heavyweight HSBC Holdings tumbled 6.2%, while China Mobile dropped 5%. In Singapore trading, shares of DBS Group Holdings lost 8.1%.
In Mumbai, ICICI Bank shares slumped 12.2% in early trading, while Infosys Technologies dropped 8.4% after the software major cut its annual earnings-per-share forecast.
In Asian currency trading, the U.S. dollar bought 99.10 yen, compared with 100.67 yen late Thursday.
Overnight on Wall Street, the Dow Jones Industrial Average fell 7.3% to 8,579.19 and the S&P 500 index shrank 7.6% to 909.92, while the Nasdaq Composite lost 5.5% to 1,645.12.
