Japan’s Nikkei 225 closes with slight gain after spending much of the day in losing territory, but Hong Kong and other Asian major and regional indexes to losses.

Stocks fall on growth fears: Shares fall for first time in three sessions on renewed worries about economic growth.

News from HONG KONG: Asian markets ended mostly lower Wednesday, renouncing some of their recent gains, as Hong Kong stocks were battered on worries about a global economic slowdown, while a weak earnings report from Larsen & Toubro dragged down Mumbai shares.

 Japanese stocks ended mixed after trading lower for most of the session, helped by a late burst of buying in financials such as Mizuho Financial Group and exporters like Nintendo Co.
“The risk of a recession is increasing. For the rest of the year, most global markets could be testing their lows,” said Patrick Shum, strategist at Karl Thomson Securities in Hong Kong. “I think the rebound we saw globally is over.”
The Hang Seng Index tumbled 5% to 15,998.30, with selling intensifying in afternoon trading after European markets opened lower. The Hang Seng China Enterprises Index fell 6.4% to 7,894.06.
In Tokyo, the Nikkei 225 Average ended up 1.1% at 9,547.47 earlier, on top of the 14.2% surge it recorded in the previous session. The benchmark fell as low as 9,269.49 earlier in the day, before rebounding in late afternoon trading. The broader Topix index slipped 0.1% to 955.51.
In Mumbai, the Sensitive Index, or Sensex, sank 5.4% to 10,865.33 in afternoon trading.
“There is still a lot of pain in the system. The market is at present like a patient with multiple fractures. A recovery is going to take time,” said Devang Shah, vice president for institutional sales at Sushil Finance in Mumbai.
Shah said foreign funds were liquidating positions, but domestic mutual funds weren’t facing any significant redemption pressures, as investors were diverting their savings into monthly investment plans with long-term maturities.
Shares of Larsen & Toubro tumbled 9.9% in afternoon trading after the engineering major reported a lower-than-expected 33% increase in fiscal second-quarter net income because of high raw material and financing costs.
Sydney, Shanghai
Elsewhere, Australia’s S&P/ASX 200 lost 0.8% to 4,300, New Zealand’s NZX 50 index gave up 1.5% to 2,904.64 and South Korea’s Kospi dropped 2% to 1,340.28.
Singapore’s Straits Times index shed 3.6% to 2,051.13 in afternoon trading, while Taiwan’s Taiex ended 0.9% lower at 5,246.26.
China’s Shanghai Composite finished 1.1% lower at 1,994.67, after official data released Tuesday showed the growth in the country’s M2 money supply — a broad measure of cash, savings and deposits — slowed to 15.3% in September from 16% in August.
UOB Kay Hian analyst Irene Gu wrote in a report that the deceleration reflects a “sluggish economy.”
“Apart from cutting both [the] reserve ratio and benchmark interest rates, we expect the central bank may release more loans quotas in the coming months to reduce the economic downside risk,” Gu added.
Regional detail
Shipping firms were hit especially hard after the Baltic Dry Index, a measure of marine freight rates, tumbled 8.5% Tuesday.
Shares of Nippon Yusen K.K. (NPNYY:
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NPNYY 10.25, 0.00, 0.0%) (JP:9101: news, chart, profile) lost 6% and Mitsui O.S.K. Lines (JP:9104: news, chart, profile) (MSLOF:
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MSLOF 6.57, +0.85, +14.8%) slumped 6.8% in Tokyo. In Hong Kong, China Cosco Holdings (HK:1919: news, chart, profile) fell 10.5%, while shares of STX Pan Ocean Co. (SPNOF:
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SPNOF, , ) gave up 2.7% in Seoul.
Shares of Mazda Motor Corp. (JP:7261: news, chart, profile) tumbled 9.2% in Tokyo after the Nikkei business daily reported that the company had put on hold plans to build a factory in North America. The delay reflects a slump in new-vehicle sales in the U.S.
Shares of Mizuho Financial Group (JP:8411: news, chart, profile) (MFG:
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4:05pm 10/15/2008
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MFG 7.15, -0.21, -2.8%) gained 3.4% and Mitsubishi UFJ Financial Group (JP:8306: news, chart, profile) (MTU:
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4:02pm 10/15/2008
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MTU 7.20, -0.55, -7.1%) added 1.4% after the U.S. government detailed a plan to inject $250 billion of capital in banks, including more than $100 million in nine of the largest U.S. banks. See full story.
Energy producers and traders lost ground after November crude-oil futures dropped $2.56 to $78.63 a barrel Monday on the New York Mercantile Exchange. The front-month contract was recently 52 cents lower at $78.11 a barrel in electronic trading.
Shares of BHP Billiton (BHP:
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BHP 35.17, -7.28, -17.1%) (AU:BHP: news, chart, profile) shed 4.2%, while Woodside Petroleum (WOPEY:
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WOPEY 27.25, +1.95, +7.7%) (AU:WPL: news, chart, profile) lost 3.1% in Sydney.
Inpex Holdings Inc. (JP:1605: news, chart, profile) skidded 5.9% in Tokyo. In Hong Kong, Cnooc (HK:883: news, chart, profile) (CEO:
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4:03pm 10/15/2008
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CEO 76.10, -14.15, -15.7%) lost 6.3% and PetroChina Co. (PTR:
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PTR 74.92, -12.04, -13.8%) (HK:857: news, chart, profile) slid 6.5%.
In Mumbai, shares of Tata Steel tumbled 8.7% in the afternoon after the Mint newspaper reported that a pension fund run by the company’s U.K. unit Corus Group had lost 53.52 billion rupees ($1.1 billion) on its exposure to the equity and other financial markets during the April-June quarter and that the losses likely increased since then. The losses came even as Tata Steel said in a statement the report was “speculative.” The company added Corus Pension Funds had a surplus in excess of $1 billion as of June 30, and the surplus was estimated to be even higher as of September 30.
Shares of chipmakers dropped after technology stocks sold off overnight on Wall Street, with Samsung Electronics (SSNLF:
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SSNLF 463.67, +41.24, +9.8%) (SSNGY:
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SSNGY 142.83, +10.62, +8.0%) losing 2.3% and Hynix Semiconductor Inc. (HXSCF:
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HXSCF 15.57, +2.10, +15.6%) giving up 4.3% in Seoul. Shares of chip-testing services provider Advanced Semiconductor Engineering (ASX:
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4:03pm 10/15/2008
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ASX 2.04, -0.27, -11.7%) lost 3.3% in Taipei.
Shares of Elpida Memory Inc. (JP:6665: news, chart, profile) lost 14.5% in Tokyo, a day after it said it was likely to make a 40 billion yen ($396 million) loss for the fiscal first-half ended September.
In Hong Kong, shares of Bank of East Asia (HK:23: news, chart, profile) (BKEAY:
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BKEAY 2.66, 0.00, 0.0%) , or BEA, ended unchanged in an overall weak market after the government said Tuesday it will guarantee all bank deposits. The announcement follows a run on the bank last month in the wake of rumors that BEA was in financial distress. BEA had denied the speculation.
In Asian currency trading, the U.S. dollar bought 101.79 yen, compared with 102.42 yen late Tuesday. End of Story
Varahabhotla Phani Kumar is a reporter in MarketWatch’s Hong Kong bureau.

Where does the US government get the money to buy into banks.

$250,000,000,000.00 I think thats right. Gee who is going to default on this loan. The only way out for the US is War with China and Russia or hyperinflation to debase the currency and pay the debt in worthless paper..
Soon the treasuries will turn and watch out below.

Here comes the grest short.. Sell the dollar

Is this how we protest now ??? Writing blogs ?? Why are we not beating down the door of our Congressmen, marching on Washington??? When push comes to shove will we really vote in a revolution??

I hear outrage, but I don’t see it. Everyone goes to work and hopes they get their paycheck and chat around the water cooler about what might happen. Somehow or other we need to get organized. We probably can’t get a 503(c) exemption, but the heck with it. We just need to organize. (whoops, I think I saw a black helicopter)

Seriously, writing is an isolated single event. Bring a million people to Washington and they have to listen. The media has to listen.

Options expire this Friday. If the market hadn’t had a big rally there would have been a lot of put options in the money and the major investment houses would have suffered major losses. Once again the government has saved them from this fate - as happened last August, and this January, March, and July.
An important question to ask is what will the government do next? This time they promised UNLIMITED (their words,not mine) funding for financial institutions. How do you top unlimited? And the stock market had a big rally, which is not a surprise since liquidity shows up first in the stock market, second in the economy and third in inflation (will unlimited liquidity result in unlimited inflation as it has in every other case throughout history?) Rallies of Monday’s magnitude have not taking place since the Great Depression in the 1930s. They were not good news then and they are not good news now.

In the 70s we had a domestic grinding bear with a few pockets of prosperity, now we have a worldwide electronic market, almost totally inter-twined. This cycle has a long ways to go before it settles out. Hope the politicians don’t get too smart and drive us into prolonged stagflation. This is a great opportunity for longterm investors to redirect and balance their portfolio with minimal tax implications.electronic market, almost totally inter-twined. This cycle has a long ways to go before it settles out. Hope the politicians don’t get too smart and drive us into prolonged stagflation. This is a great opportunity for longterm investors to redirect and balance their portfolio with minimal tax implications.

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