Tuesday December 16, 05:07 AM
Asian share markets mostly down
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HONG KONG (AFP) - Asian stock markets were mostly down Tuesday, tracking a drop on Wall Street as a tumble in Japanese business confidence and new signs of a China slowdown underlined worries in the region.
Those concerns deepened on news that HSBC (LSE: HSBA.L - news) , Europe's biggest bank, and other major lenders faced heavy exposure to the alleged 50 billion dollar pyramid scheme said to have been run by one of the biggest names in US investing.
Tokyo was down 0.65 percent, while Hong Kong was off 0.9 percent and Sydney lost 1.3 percent in early trade. Taiwan's main index was 1.3 percent lower, while New Zealand bucked the trend, up 0.65 percent.
"The tone is reasonably positive but that could change quickly," said Byron Burke, a broker with ABN Amro Craigs in New Zealand.
While some dealers thought the pre-Christmas lull was kicking in, sentiment was affected by the seemingly endless string of bad news coming out of the United States.
The allegation of a pyramid fraud against Wall Street legend Bernard Madoff took on new dimensions overnight as some of Europe's biggest banks said they had exposure to his firm, which US authorities said would be liquidated.
HSBC said it had exposure of about one billion dollars, while Europe's second-biggest bank Santander (Madrid: SAN.MC - news) said it had a three billion dollar exposure to Madoff Invest Securities.
Fortis Bank Netherlands said it could lose one billion dollars from the alleged scam, even though it had no direct exposure to Madoff's company.
European shares dropped Monday on the news, with the CAC 40 (Paris: news) in France off 0.87 percent and the Dax (Xetra: news) in Frankfurt down 0.18 percent. London's FTSE 100 was flat, off 0.07 percent.
In the United States, the Dow Jones Industrial Average lost 0.75 percent while the Nasdaq (NASDAQ: news) tumbled 2.1 percent.
The woes mounted Monday as Japan's central bank said business confidence had suffered its sharpest drop in three decades.
China, which on Monday announced that industrial output in November rose at its slowest pace in a decade, said Tuesday that urban fixed asset investment also slowed slightly last month.
Meanwhile there has been no firm progress on a possible bailout for the struggling Big Three US automakers -- General Motors (NYSE: GM - news) , Ford and Chrysler. The White House said Monday it was still studying its options.
Lawmakers have said time is running out for the auto giants, and traded blame with union chiefs over last week's collapse in the Senate of a short-term 14-billion dollar rescue.
The White House has now said it is ready to consider dipping into a 700-billion dollar Wall Street bailout agreed earlier this year.
The global financial crisis and the economic slowdown have hit share markets worldwide hard this year, and every major market has suffered big losses.
The Dow Jones is off 35 percent, Hong Kong's Hang Seng (news) is down 46 percent and the Nikkei (news) in Tokyo has lost almost 44 percent since the beginning of the year.
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