SALON

Thursday, Jun 14, 2012 3:15 AM UTC

Asia stocks fall after Europe debt turmoil worsens

By

Topics: From the Wires,

BANGKOK (AP) — Asia stock markets fell Thursday, as ominous signs emerged that a debt crisis that has been roiling Greece and then Spain is about to erupt elsewhere on the continent.

Investor sentiment was battered by developments Wednesday, when Italy’s borrowing costs rose and Cyprus said it may seek an emergency bailout this week.

Yet another troubling sign came out of Spain, whose 10-year borrowing rate inched up to 6.71 percent from 6.67 percent. That is close to the 7 percent rate that led Greece, Portugal and Ireland to seek bailouts.

Japan’s Nikkei 225 index fell 0.7 percent to 8,528.51. Hong Kong’s Hang Seng dropped 0.8 percent to 18,877.40 and South Korea’s Kospi was nearly flat at 1,858.73.

Moody’s, the credit ratings agency, downgraded Spain’s government debt three notches late Wednesday, placing it one level above junk status. It downgraded Cyprus’s debt by two, pushing it deeper into junk rating.

Italy, meanwhile, had setbacks of its own. Its 10-year borrowing rate rose to 6.07 percent from 6.02 percent, and the interest rate on its one-year bonds also rose sharply.

Greece will hold elections Sunday, and voters may endorse a party that wants to cancel the terms of Greece’s own bailout. That would almost certainly force Greece to leave the euro currency.

“The Greek election will undoubtedly be seen as a landmark event in history, as it goes to the core of Greece’s continuation in the eurozone and the fate of the region itself,” Cameron Peacock of IG Markets in Melbourne said in a market commentary.

The turmoil in Europe weighed Wall Street down on Wednesday. The Dow Jones industrial average fell 0.6 percent to 12,496.38. The Standard & Poor’s 500 fell 0.7 percent to 1,314.88. The Nasdaq composite index fell 0.9 percent to 2,818.61.

Benchmark oil for July deliver was down 23 cents to $82.39 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 70 cents to finish at $82.62 per barrel on the Nymex on Wednesday.

In currency trading, the euro fell to $1.2561 from $1.2589 late Wednesday in New York. The dollar rose to 79.42 yen from 79.33 yen.

More Pamela Sampson.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments are not enabled for this story.

follow salon

Most Read

Popular on Reddit

links from salon.com

vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
174 points175 points | 124 comments
vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
159 points160 points | 111 comments
vote
Ted Cruz against the world - How the Junior Senator is igniting the GOP civil war
82 points83 points | 21 comments
vote
Judge tells lesbian couple to separate or lose kids: "unmarried sexual relationships -- including straight ones – can be grounds for losing child custody"
38 points39 points | 3 comments
vote
Anonymous rallies behind Kaitlyn Hunt
22 points23 points | 24 comments

From Around the Web

Presented by Scribol
listener_new_rect The Listener: Chekhov's story mirrors Russia's own

Recommendations