Asian market flu carries over to Europe

January 12, 1998
Web posted at: 5:48 a.m. EST (1048 GMT)

(CNN) -- A rocky day of trading in Asia carried over to European markets Monday as jittery investors unloaded holdings. Stock prices in Hong Kong plummeted 8.7 percent to its lowest level in three years. The FTSE 100 in London plunged 2.5 percent in the first 15 minutes of trading.

"We are witnessing extraordinary moves in global asset market," one dealer told Reuters. "Everyone is now starting to talk bearishly."

The global market dip came as senior officials from the United States and the International Monetary Fund launched an emergency effort to calm East Asia's economic turmoil.

It also comes on the heels of Wall Street's fourth-worst single-session point loss in history. On Friday, the Dow Jones Industrial Average plummeted 2.82 percent, or 220.20 points.

• Rattled by rising interest rates, reports that a major Hong Kong-based investment bank may shut down, and the sharp decline on Wall Street on Friday, Hong Kong shares closed down 773.58 points at 8,121.06.

Last week, the index dropped nearly 17 percent.

A Hong Kong bank clerk, Chau Ho-yeung, said his 70,000 Hong Kong dollar investment ($8,970) was now worth about 10,000 Hong Kong dollars ($1,282.)

"I'm expecting the worst. I've lost everything, and I'm now only holding on to a pile of wastepaper," Chau said.

• In Tokyo, the Nikkei shed 330.66 points, or 2.21 percent, closing at 14,664.44. Taiwan's main stock index fell to a 10-week low, plunging 4.7 percent.

• In Australia, the All Ordinaries Index dropped 2.3 percent.

• In Singapore, the Straits Times Industrials Index was 104.69 lower at 1,071.66. In Malaysia, the Composite Index was down 3.4 percent.

But market prices were higher on two of the region's most troubled economies: Indonesia and South Korea. Share prices rose 2.1 percent on the Jakarta Stock Exchange. In Seoul, the Korea Stock Exchange closed 2.43 percent higher on strong buying interest from local investors, analysts said.

Meanwhile, stock markets in Germany, Britain and France suffered in early morning trading:

• The main German share index DAX dropped nearly four percent to 4,070 points.

• Share prices on the French stock market slumped by 3.35 percent

• In London, the FTSE 100 was down 130.7 points, or down 2.5 percent down, after 15 minutes of trading.

Special coverage:

• CNNfn special report: Asian market turmoil

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