More bearish economic data from the United States took a toll on Asian financial markets this week, with Tokyo hitting a new 17-year closing low.
Tokyo stocks fell Friday as a strengthening yen and corporate earning downgrades sapped investor confidence.
The benchmark Nikkei Average Friday finished down a little more than two percent at 10,713 its lowest point in 17 years. The market reacted nervously to tech giant Hitachi's announcement that it will lay off 14,700 employees worldwide and expects a loss of more than a $1 billion this fiscal year. Hitachi shares shed more than four percent.
Shares in the consumer electronics company, Sony, also took a hit as a stronger yen weighed on Sony's exports. Wall Street's dismal performance this week sent the dollar to a three-month low against the yen, making Japanese products more expensive in the United States. Sony shares slid more than five percent Friday.
In Hong Kong, the mood was equally somber with the benchmark Hang Seng index losing two percent to close at a new 28-month low. Steep loses in U.S. tech stocks ignited fears of another round of closings and layoffs at tech-related companies in Hong Kong.
The Hang Seng managed to close just above the key 11,000 level. But financial analyst Julian Mayo believes it could drop sharply in the coming weeks. "I expect to see Hong Kong below 10,000 by the end of this year," he said. "The main features of the stock market are banks, which are heavily dependent on property, property itself, and telecoms. And I wouldn't want to be in any of those three sectors at the moment."
Property, bank, and telecom stocks have all suffered in the midst of the global slowdown. China's top cell phone company, China Mobile, lost more than two percent and banking giant HSBC Holdings fell almost 2.5 percent Friday. The slide was in reaction to the territory's announcement that it was slashing this year's GDP growth forecast.
In Seoul, the KOSPI lost more than three percent to end at a one-month closing low of 545. Analysts say many of the stocks were under heavy pressure from declines in New York and Tokyo.
Taiwan stocks closed slightly higher at four thousand 509, as late buying erased losses triggered by falls in U.S. stocks. Singapore shares remained almost unchanged at just over 1,615.