Asia stocks slide

Asian stock markets fell Friday on concern China might further tighten credit and fears about Europe’s debt crisis as global leaders meeting in South Korea struggled to soothe currency tensions.

The losses across Asia followed a down day on Wall Street where Cisco Inc., the world’s largest maker of computer networking gear, rattled investors by cutting its sales forecast for a second quarter in a row.

Oil prices tumbled below $87 after big gains the previous two days.

China’s Shanghai Composite Index dived 3.3 percent to 3,043.39 amid expectations of more government measures to slow economic growth after inflation hit a 25-month high in October.

“There are some rumors there might be another interest rate hike this weekend,” said Linus Yip, a strategist for First Shanghai Securities in Hong Kong. The Chinese decline dragged down prices elsewhere in Asia, Yip said.

Japan’s benchmark Nikkei 225 stock index slid 101.67 points, or 1 percent, to 9,759.79 and Australia’s S&P/ASX 200 shed 0.8 percent to 4,692.70.

Hong Kong’s Hang Seng fell 1 percent to 24,450.77 and South Korea’s Kospi was down 0.1 percent at 1,912.40. Markets in India, Singapore and Taiwan were also lower.

Markets were on edge as leaders from the Group of 20 major advanced and developing nations struggled at a summit in Seoul to resolve a U.S.-China currency dispute that threatens to escalate into a global trade war.

Adding to negative sentiment was mounting speculation that Ireland — one of Europe’s most financially troubled countries — would not be able to cut public spending and may have to resort to a bailout.

In Seoul, President Barack Obama, China’s Hu Jintao and the other 18 leaders were in closed-door talks to thrash out a final statement for the G-20 meeting after overnight negotiations by aides that lasted until daybreak.

The dispute over whether China and the United States are manipulating their currencies is threatening to resurrect destructive protectionist policies like those that worsened the Great Depression in the 1930s. The biggest fear is that trade barriers will send the global economy back into recession

On Wall Street, the Dow Jones industrial average shed 73.94 points, or 0.7 percent, to close at 11,283.10 as the weak outlook from Cisco shook faith in the strength of the technology industry’s recovery.

In currencies, the dollar rose to 82.36 yen from 82.32 yen late Thursday in New York. The euro fell to $1.3620 from $1.3648.

Benchmark crude for December delivery fell $1.34 to $86.47 a barrel in electronic trading on the New York Mercantile Exchange. The contract settled unchanged at $87.81 on Thursday.
Source: AP

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