By Tom Miles
HONG KONG (Reuters) - Investors dumped euros and shares onFriday as U.S. economic troubles made bets on growth elsewherelook too risky, sending stocks to their lowest in two yearswhile triggering a surge in safe-haven government bonds.
The ratcheting up of fear followed a 3 percent sell-off onWall Street on Thursday, the steepest decline for more than twomonths, prompted by an unexpected jump in jobless claims andnervousness ahead of monthly jobs data on Friday.
The renewed worries sent the yen soaring as investorsunwound carry trades, ditching bets in which they had borrowedthe Japanese currency to buy euros or high-yielding Australianor New Zealand dollars.
"This is not a flight to quality, it is simply a flight,"said Alan Ruskin, chief international strategist at RBSGreenwich Capital.
"Gold for example has failed to benefit, cash is king --even the greenback, warts and all, or the yen, zero rates andall."
The euro hit a 13-month low of 150.60 yen before pullingback to 152.30 yen, having recorded a 3.6 percent drop onThursday -- its biggest one-day fall since the massivecarry-trade unwind in 1998.
"Everyone it seems is closing out positions," said a traderat a Japanese trust bank. "Hedge funds are rapidly unwindingcarry trades, and Japanese institutional investors with assetsabroad are buying back the yen."
The Australian and New Zealand dollars -- long thebellwethers of the carry trade -- sank to two-year troughsagainst the Japanese currency.
SHARES SLIDE
The prospect of less competitive exports to Europe, as wellas growing gloom about the global economy, hit Japanese sharessuch as Mizuho Financial Group and Sony Corp, which fell 6.6percent and 4.4 percent, respectively.
At 0400 GMT, Japan's Nikkei average was down 2.8 percent,after touching its lowest since March 19, while stockselsewhere in the Asia-Pacific, gauged by MSCI's index were down2.4 percent.
The MSCI All-Country World index, down 0.6 percent, plumbedits lowest level since August 2006.
Data during the day showed Japanese companies unexpectedlycut capital spending in the second quarter, likely meaning theeconomy contracted even more than previously estimated duringthe April-June period.
A VOLATILE RIDE
As investors dumped stocks, Japanese government bondfutures rose, reversing losses made in thin trade on Thursday.
September 10-year futures jumped 1.44 points to 138.94. Thebenchmark 10-year yield fell 6 basis points to 1.450 percent.
Analysts said 10-year yields would likely have a tough timefalling below their four-month low of 1.400 percent.
"Our view is that these are highly volatile markets goingnowhere," said John Richards, head of Asia economics andstrategy at RBS Securities. "With the central bank on hold andthe economy probably in a mild recession, we're stuck in thissituation."
The iTRAXX Asia ex-Japan high-yield index, a key measure ofrisk aversion, widened as much as 15 basis points (bps) to 579,its biggest since early July at the height of concerns overU.S. mortgage financing providers Fannie Mae and Freddie Mac.
The equivalent investment-grade index widened by as much as8 bps to 173. However, both indexes tightened by a few basispoints each later.
Growth fears rattled commodity markets, with Tokyo platinum-- used in vehicle exhausts -- plunging by the daily 300 yenlimit, or 6.1 percent, because of worries about weak car sales,as well as dollar strength against the euro and weak oilprices.
Gold dipped to $790 an ounce.
In Shanghai, copper fell almost 2 percent to its lowest inthree weeks, while the London contract continued Thursday's 1.6percent slide in electronic trading.
U.S. crude oil held firm in Asian trade, having fallen$1.46 to $107.89 a barrel in New York on Thursday, extending aslide from an all-time peak of more than $147 in mid-July.
(Additional reporting by Shinichi Saoshiro, Eric Burroughsand Elaine Lies in TOKYO; Editing by Lincoln Feast)
Relacionados
- Global growth, U.S. job fears hammer Wall Street
- Global growth, U.S. job market fears slam Wall St.
- Wall St tumbles on labor market, global growth fears
- Beam Global Spirits & Wine, Inc. and the Edrington Group AnnounceDynamic New International Sales and Distribution Alliance
- QAD Explore EMEA Customer Conference to Focus on Latest Enterprise Product Innovations for Global Manufacturers