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Asian Stocks Drop on Concern U.S. Subprime Losses Will Spread
2007-11-26 19:45 (New York)


By Chen Shiyin and Patrick Rial
Nov. 27 (Bloomberg) -- Asian stocks fell for the first time
in three days on speculation financial institutions will report
increased losses from U.S. subprime mortgage-related securities.
Mizuho Financial Group Inc. and Macquarie Group Ltd. led
declines after Goldman, Sachs & Co. said HSBC Holdings Plc,
Europe's biggest bank, may have to write down an additional $12
billion for non-performing subprime assets and CNBC said
Citigroup Inc. may shed 45,000 jobs.
In the U.S., the Standard & Poor's 500 Index fell 2.3
percent yesterday, the biggest drop in more than two weeks.
``With the U.S. performing so poorly, it can only mean bad
news for the market here,'' said Terunobu Kinoshita, who helps
manage $785 million at Fund Creation Co. in Tokyo.
The MSCI Asia Pacific Index declined 1.3 percent to 156.49
as of 9:36 a.m. in Tokyo, halting a two-day, 3 percent advance.
Financial shares were the biggest drag among the benchmark's 10
industry groups.
Japan's Nikkei 225 Stock Average slumped 1.9 percent to
14,847.03. Toyota Motor Corp. led a drop by exporters after the
yen strengthened to the highest since June 2005 against the
dollar, reducing the value of companies' overseas sales.
Australia's S&P/ASX 200 Index slipped 1.8 percent, while the
Kospi index dropped 2.5 percent in South Korea.

Mizuho, Macquarie

Mizuho Financial, Japan's second-largest publicly traded
bank, fell 3.5 percent to 532,000 yen, snapping a two-day, 6.6
percent gain. Macquarie, Australia's biggest investment bank,
slid 2.5 percent to A$75.66, after gaining 2.5 percent in the
previous two sessions.
HSBC may have to set aside additional funds for bad debts
because of customer defaults at its U.S. subprime lender
Household International Inc., Goldman said, lowering the
company's Hong Kong-listed stock to ``sell'' from ``neutral.''
London-based HSBC also said yesterday it will bail out its two
structured-investment vehicles by taking on $45 billion of their
assets to avoid a fire sale.
Citigroup, which earlier this month announced at least $8
billion of fourth-quarter writedowns on mortgage investments,
said it is reviewing ways to cut costs and declined to comment on
specifics. Citigroup may cut as many as 45,000 jobs in the next
two months, CNBC reported yesterday, citing unidentified people
within the company.

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