Fed warning pushes Asian stocks down
22 Sep 2011
Asian stocks were in retreat today after Wall Street was driven down over 2 per cent by investors spooked by the Federal Reserve's warning that the US faced a grim economic outlook.
According to the Fed's overnight warning, the economy faced "significant downside risks" which the Fed sought to counter with an effort to lower long-term borrowing costs and bolster housing.
According to the HSBC's flash PMI numbers pointed to a fall in China's factory output the third straight month. The news triggered a sell off in resources and cyclical stocks across the region.
The FTSE CNBC Asia 100 Index which monitors markets across Asia, dropped 4.3 per cent.
Greater China stocks were in negative territory, as the Hang Seng fell to its lowest level since July 2009, closing down 4.85 per cent.
Mainland energy and property counters were hit hard after shares of property developer Greentown fell 16 per cent. According to a Reuters report, China's banking regulator had ordered trust firms lending to the sector, to report their exposure to the company.
