Asia shares fall on economic growth fears

HONG KONG: Asian markets mostly fell today as dealers ignored a surge on Wall Street, with worries about the global economy continuing to weigh on sentiment while Japan’s credit rating was cut.

The dollar slipped against the yen on disappointment over a Japanese plan to halt its currency’s rise, which hit a post-war record last week, with many dealers saying the government was not bold enough, analysts said.

Most regional bourses began on a high after the three main indexes in New York posted huge gains on hopes that Federal Reserve chairman Ben Bernanke will announce a fresh round of monetary easing to kickstart the US economy.

However, they soon retreated, with nervousness stoked by a downgrade by Moody’s of Japan’s credit rating, citing the country’s high debt levels and budget deficit.

Tokyo lost 0.52 per cent, Hong Kong fell 0.81 per cent by the break, Seoul gave up 0.76 per cent and Taipei was 0.9 per cent lower while Sydney was flat but Shanghai gained 0.17 per cent.

US markets were given a lift by better-than-expected manufacturing data from China and the eurozone.

However, the upbeat sentiment was dented by the decision by Moody’s to cut Japan’s bond rating to Aa3 from Aa2, citing the “large budget deficits and the build-up in Japanese government debt since the 2009 global recession”.

It is the first time since the March 11 earthquake and tsunami that a major ratings agency has downgraded its sovereign debt. Moody’s said the outlook was stable. - AFP