HONG KONG (MarketWatch) -- A week of solid gains ended on a sour note for Asian markets Friday as stocks got broadly hammered as hopes for a U.S. government bailout of the Big Three automakers collapsed.
Regional automakers -- such as Toyota Motor Corp., Honda Motor Co. and Hyundai Motor Co., all of which depend heavily on the U.S. market -- plunged in afternoon trading.
Meanwhile, the dollar fell against the Japanese yen in Tokyo trading, hitting a 13-year low of 88.02 yen, before rebounding after news broke on Capitol Hill that the Senate had failed to reach a compromise on the proposed auto-loan package, which had cleared the House of Representatives Wednesday night. See full story.
"I think there'll be a lot of knee-jerk reactions on the news," said Andrew Sullivan, a sales trader at Main First Securities in Hong Kong. "It just indicates nervousness and the lack of clarity."
In foreign-exchange action, the dollar stood at 90.43 yen in late dealings in Tokyo, compared with 91.80 yen on Thursday. The euro changed hands at 119.74 yen versus 121.45 yen.
Shares of Japanese exporters suffered as a result of the weakness in the dollar.
Concerns that stocks on Wall Street could drop sharply exerted marked selling pressure on Asian equities. U.S. stocks futures indicated a sharp pullback at the Friday open. See Indications.
Energy traders also took their cue from the latest doings in Washington. January crude-oil futures, which had jumped 10.2% on the New York Mercantile Exchange overnight, lost as much as $1.58 to $46.40 a barrel in electronic trading recently.
Brutal numbers
To cap off the week, Tokyo's Nikkei 225 Average (JP:1804610: news , chart , profile ) slumped 5.6% to 8,235.87, snapping a four-session winning streak and narrowing weekly gains to 4%. The broader Topix Index gave up 4.2% to 813.37.
Analysts said Friday's action could signal that Asian markets have topped out after a multi-week rise from lows in October.
"We'll move lower from here," said Sean Darby, a strategist with Nomura International. "I don't think there's much incentive for people, especially foreign investors, to put money in."
Bearishness prevailed across Asia at week's end.
South Korea's Kospi, which had risen for five straight sessions, tumbled 4.4% to 1,103.82, leaving the benchmark's weekly gain at 7.4%.
Australia's S&P/ASX 200 skidded 2.4% to 3,510.40, while New Zealand's NZX 50 index dipped 1.8% to 2,676.95.
Taiwan's Taiex gave up 3.7% to 4,481.27. The retreat came in spite of a reduction of three-quarters of a percentage point in interest rates, to 2%, ordered by the Taiwanese central bank on Thursday.
In afternoon trading, Singapore's Straits Times Index dropped 3.5% to 1,730.75, with India's Sensitive Index faring better, slipping just 0.3% to 9,616.10.
China's Shanghai Composite gave up 3.8% to 1,954.21. Official data released earlier Friday showed retail sales on the mainland last month rose 20.8% from November 2007, a growth easing from a 22% increase in October.
