Asia stocks slump on recession fears

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TOKYO: Global stocks slumped to more than two-month lows in early Asian trade on Thursday (Aug 15), tracking the Wall Street slide as an inverted ...

in opening trade and Australian stocks falling 1.9 per cent.

The Hang Seng Index fell 1.47 per cent, or 372.61 points, to 24,929.67 at the open, as confidence in the economy wanes and protests in the financial hub show no sign of abating.The benchmark Shanghai Composite Index declined 1.66 per cent, or 46.57 points, to open at 2,762.34. The Shenzhen Composite Index, which tracks stocks on China's second exchange, opened 2.08 percent, or 31.45 points lower, at 1,477.55.

In early Asian trade, 10-year US Treasury yields dipped to their lowest in 3 years, while the 30-year yields fell to as low as 1.991 per cent, below the 2 per cent floor for the Federal Reserve policy rate for the first time ever. A dip below 2 per cent took the entire curve up to 30 years below official interest rates.The US stock futures managed to steady a little in Asian trading, erasing earlier losses.

"The markets are digesting the sharp overnight setback, triggered by the inverted yield curve. But I think we'll see some calmness back before long since the US curves inverted only temporarily, not on a closing basis," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

Gold rose over 1 per cent on Wednesday as an inverted US Treasury yield curve and weak euro zone data drove investors toward safe-haven bullion.

 

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