As if we didn't have enough problems, Japan's primo financial regulator was on the take and has resigned in scandal.....just what the markets needed.
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Techs, political scandal jolts Tokyo
Nasdaq sell-off chills Asia techs
By Mariko Ando & Vivian Chu, CBS.MarketWatch.com
Last Update: 11:21 PM ET Jul 30, 2000 NewsWatch
Latest headlines
TOKYO (CBS.MW) -- Japan's ill stock market took a turn for the worse on Monday, tumbling more than 1.1 percent on the worsening outlook for global technology shares and disgust over Japan's political system.
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Other major stock markets in the region also declined after the Nasdaq tumbled nearly 5 percent Friday, when stronger-than-expected U.S. economic growth data triggered interest-rate concerns.
Tokyo's Nikkei Average sank 1.12 percent, or 177.34 points, to end the morning session at 15,661.23, after falling as low as 15,394.71 - the lowest intraday level since March 10, 1999.
The broader TOPIX lost 1.34 percent to 1,433.49. Shares of Sony Corp. (SNE: news, chart) lost 1.1 percent, while Matsushita Electric Industrial (MC: news, chart) fell 1.6 percent.
Japan's Financial Reconstruction Commission chief Kimitaka Kuze -- the nation's top financial regulator -- resigned after admitting to taking money and benefits from a bank and the news helped trigger selling of Japanese stocks, analysts said. See full story.
"The market was weak enough following the Nasdaq's downturn and banks' continuous selling of cross-held shares, and now we have Sogo's unexpected failure and Kuze's resignation," said Teruhisa Ishikawa, deputy manager of the investment products planning section at Izumi Securities Co.
"It's hard to tell when this selling will stop. The index could break below 16,000 level without big positive news."
Ishikawa added that the resignation had a limited impact so far.
Japanese bonds drew buying interest. The key bond saw its yield fall to a six-week low. The 10-year No. 223B bond rose 0.09, or 44 yen, to 100.345. The yield fell 1 basis point to 1.66 percent -- the lowest 10-year benchmark yield since June 21.
In South Korea, the Kospi Index lost 1.26 percent, or 8.76 points, to 683.89. Telecommunication and technology shares lost ground after seeing their counterparts in the Nasdaq fall. Shares of SK Telecom Ltd. (SKM: news, chart) tumbled 5.6 percent and Samsung Electronics Co. (SSNGY: news, chart) lost 2.1 percent to 280,500 won.
But Pohang Iron and Steel Co. (PKX: news, chart) gained 1.2 percent to 85,000 won. The Nihon Keizai daily reported that the company is in final stage talks with Japan's Nippon Steel Corp on a comprehensive alliance, which could involve overseas joint ventures, e-commerce, joint raw material procurement and basic research and development.
Hong Kong stocks slid sharply at the open. The Hang Seng Index slid 2.36 percent to 16,777.76 points soon after the start of trading. Shares of Pacific Century CyberWorks (PCCLF: news, chart), one of the region's biggest Internet investors, fell 2.13 percent to 16.05 Hong Kong dollars.
On Monday the firm said it agreed to sell a 17 percent stake in ILink.net, a Hong Kong data center operator, for $3.35 million to its chief executive.
Shares of the city's biggest bank, HSBC Holdings (HBC: news, chart), lost 2.9 percent to 100.50 Hong Kong dollars. The bank and its sister institution, Hang Seng Bank Ltd. (HSNGY: news, chart), are expected to report strong first-half earnings after the market close on Monday.
Taiwan stocks slipped into the red from the open. The tech-heavy Weighted Index edged down 0.54 percent, or 44.14 points, to 8,099.79 by mid-session, pulled down by the island's two biggest chipmakers, Taiwan Semiconductor Manufacturing Co. (TSM: news, chart), shares of which slipped 0.8 percent to 127.00 Taiwan dollars, and United Microelectronics, shares of which fell 0.7 percent to 75.50 Taiwan dollars.
In Australia, the All Ordinaries Index was down 0.27 percent, or 8.80 points, at 3,210.30 by late morning, dragged down by Internet-related shares such as Davnet Ltd. (DAVNY: news, chart) which plunged 10.6 percent to 1.52 Australian dollars. Media conglomerate News Corp. (NWS: news, chart) slipped 0.2 percent to 18.00 Australian dollars.
New Zealand's benchmark NZ Top 40 Index shed 0.56 percent, or 11.85 points, to 2,101.39. Singapore's Straits Times Index lost 1.17 percent, or 23.89 points, to 2,015.13.
Malaysia's KLSE Composite was down 0.97 percent at 791.32 points.
The dollar firmed against the yen and was trading recently at 109.70 yen, compared with 109.55 yen late Friday in New York. It changed hands at 108.93 yen in Tokyo late Friday.
Back in Japan, shares of core tech companies declined, as the Nasdaq's tumble renewed fears of worse-than-expected downturn in global technology stocks.
Sony Corp. lost 110 yen to 10,070 yen and Hitachi Ltd. (HIT: news, chart) shed 0.5 percent to 1,261 yen.
Internet investor Softbank Corp., which is heavily invested in Nasdaq-listed Internet-related hares, tumbled 7.9 percent to 8,430 yen.
Shares of condominium firm Daikyo Inc. tumbled 15 yen, or 6.5 percent, to 216 yen on media reports that it has paid 100 million yen to Financial Reconstruction Commission chief Kimitaka Kuze.
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Mariko Ando is a reporter for CBS MarketWatch.com.
Vivian Chu is a reporter for CBS.MarketWatch.com.
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