Asian stocks lower on debt woes in Europe, US
HONG KONG (AP) — Worries about Europe's banking woes, debt problems in the U.S. and the global economy dragged down most Asian stock markets Monday.
Crude oil fell and the dollar strengthened against the euro while falling slightly against the Japanese yen.
The results of stress tests on European banks that were released after the close of trading Friday overshadowed the start of this week's trading in Asia. The results did little to reassure investor confidence in the continent's shaky financial sector, revealing that eight of 90 European banks flunked tests aimed at revealing how they would fare in another recession. Another 16 barely passed.
Investors are also unsettled by the failure of U.S. politicians to work out a deal to avoid a debt default before a deadline that is just two weeks away.
"Looking ahead, sovereign debt worries in the U.S. and Europe and a pickup in second-quarter U.S. earnings data are going to compete for traders' attention," said Ben Potter, a research analyst at IG Markets in Melbourne, Australia. "The only real certainty in the coming days is that there is likely to be volatility as the market grapples with these major issues."
South Korea's Kospi fell 0.6 percent to 2,131.80, while Australia's S&P/ASX 200 was 0.1 percent lower at 4,469.60. The Shanghai Composite Index was nearly flat at 2,820.88. Hong Kong's Hang Seng, however, bucked the trend, rising 0.7 percent to 22,012.12.
Benchmarks in Singapore, Taiwan and New Zealand also sank. Markets in Japan were closed Monday for a national holiday.
On Wall Street on Friday, stocks avoided having their worst week in nearly a year after a late rally.
The Standard and Poor's 500 stock index finished with a gain of 7.27 points, or 0.6 percent, to 1,316.14. The Dow Jones industrial average added 42.61 points, or 0.3 percent, to 12,479.73. The Nasdaq composite rose 27.13 points, or 1 percent, to 2,789.80.
In currencies, the euro fell to $1.4065 from $1.4136 late Friday. The dollar weakened to 79.01 yen from 79.11 yen.
Benchmark West Texas Intermediate crude for August delivery fell 1 cent to $97.23 per barrel. The contract settled at $97.24 per barrel Friday on the New York Mercantile Exchange. Brent crude fell 49 cents to settle at $116.77 per barrel on the ICE Futures exchange.