Asian stocks fell, and the corresponding regional index suffered its first weekly loss (-1,2%) in more than a month on growing concerns over US debt. In particular, investors are doubtful that an agreement on the US debt ceiling, currently set at 16,7 trillion dollars, will be easily reached. The US Treasury Department has warned that a federal default could lead to a recession at the level of the 2008 financial crisis or even worse.
On the stock front, Blumont Group plunged 56% in Singapore before trading halted on news that the company had agreed to buy an as-yet-unnamed coal producer. Digital Garage lost 6% after a Twitter Inc. filing failed to mention the Japanese company among its shareholders. GS Yuasa, the Japanese maker of automotive and motorcycle batteries, slipped 4,8% after Mitsubishi UFJ Morgan Stanley Securities cut its rating.
Overall, the MSCI Asia Pacific index was down 0,3% to trade at 139.09 as of 12:18 in Tokyo on a day when nine out of ten industry groups represented by the index lost value. The Japanese central bank today maintained its monetary policy following a two-day meeting. The decision came during a trading lull. The Topix index fell 0,6% as South Korea's Kospi fell 0,2% on reopening after a holiday period. New Zealand's NZX 50 was down 0,3% and Australia's S&P/ASX 200 was down 0,4%. The Hang Seng index dropped 0,6%, while the Chinese stock market is closed for holidays until October 8th.
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