Asian stocks fell, weighed down by the collapse of the American market. In particular, Japanese stocks fell from six-year highs after the Standard & Poor's 500 plunged to two-month lows. The MSCI Asia Pacific Index was down 1% at 10:57am in Tokyo. At the same time, the Topix was down 1,3% after yesterday posting its best close since June 2008. Australia's S&P/ASX 200 index dropped 1 percent. South Korea's Kospi lost 0,3%, while the Nikkei 225 Stock Average, which yesterday was at its highest since November 2007, fell 1,2%. In short, volatility reigns supreme. The Chicago Board Options Exchange Volatility Index (known as VIX) rose 18% to 15.64 yesterday, the biggest jump since last July. The Hang Seng Volatility Index was up 2,1 percent today and the Nikkei Stock Average Volatility Index was up 3,4 percent. On the currency front, the New Zealand dollar strengthened by 0,3% after yesterday's sharp slowdown, caused by some statements by the Kiwi Central Bank in which the down-under currency was considered overvalued, statements which also pulled down the Australian dollar. Gold was up 0,2 percent.
In Japan, inflation slowed more than expected. The worrying data shows that BOJ Governor Haruhiko Kuroda's work remains hard and tiring in the coming months. “With investors puzzled over the cause of the equity decline, many are now wondering if this is but the beginning of a major correction period,” said Andrew Wilkinson, chief market analyst at Interactive Brokers.
