Asian markets ‘spooked’ by IMF growth revision

HONG KONG: sian markets fell for a second straight day Wednesday as investors reacted to losses on Wall Street after the IMF cut its global growth forecasts, predicting the slowest rate in three years.

Japanese shares were also hit by the strengthening yen, while selling was fuelled by news the country’s top car makers saw sales in China slump in September owing to a diplomatic spat between Tokyo and Beijing. Tokyo tumbled 1.69 percent by the break, Hong Kong fell 0.47 percent, Shanghai was 0.26 percent lower, Sydney lost 0.38 percent and Seoul shed 1.06 percent.

The International Monetary Fund on Tuesday cut further its growth estimates for the world economy this year and next, citing the ongoing European debt crisis and stuttering growth in the US economy.

The latest Global World Outlook, which said Asia was being hit by a slowdown in China, also warned that conditions could even worsen if the eurozone problems were not dealt with.

It also followed a similar downward revision for Asia’s growth by the World Bank and Asian Development Bank.

“Markets have gone a bit too far and people are starting to get worried about the growth outlook,” Matthew Sherwood, head of investment market research at Perpetual in Sydney, said.

AFP