Monday, November 17, 2008

Indian Markets Down on Japan Recession News

Stocks opened on a flat note with a positive bias on Monday tracking Asian peers.

National Stock Exchange’s benchmark Nifty rose 13.15 points or 0.38% to 2823. Bombay Stock Exchange’s 30-share Sensex climbed 34.70 points to 9420 from Friday’s close.

Japan contracted at an annual pace of 0.4% in the July-September period after a declining an annualized 3.7% in the second quarter. Falling business investment is behind the latest drop in economic output. Japan's government has been anticipating economic challenges, and is trying to negotiate parliamentary approval of a $300 billion stimulus package, its second this year.

Stocks across the region fell after two Asian economies – Japan and Hong Kong – slid into recession and the Group of 20 nations delayed agreeing on specific measures to combat the global crisis. However, the Nikkei average rose 1% in thin trade as some investors rushed in to buy following an initial sell-off after data showed Japan's economy was in recession.

US stocks also slid on Friday after a record drop in retail sales last month increased fears that American consumers' reluctance to spend will push the economy into an even deeper downturn than currently expected.

The Dow Jones Industrial Average slid 337.94 points, or 3.82%, to end at 8,497.31, Standard & Poor's 500 Index fell 38 points, or 4.17%, to finish at 873.29 and the Nasdaq Composite Index lost 79.85 points, or 5%, to close at 1,516.85.

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