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(CEP News) - To add misery upon misery, the Nikkei dived 11% today, after on Wall Street stocks saw a free fall in the last hour of trading, with the Dow Jones seeing its largest percentage drop since 1987.
Tokyo's stock index may follow suit - if the 11% fall holds until market close, it will record it's largest fall since 1987's crash. The Japanese Nikkei is currently down 877.75 points to 8279.738 Economists at Barclays Capital said, "The most prevalent colour on the screens of financial market traders is still red as a succession of bailout packages on both sides of the Atlantic have so far failed to restore confidence." The ASX also saw record falls today, down 7% and dipping below 4,000, its lowest in three years. Sydney's S&P ASX 200 is currently down 247.70 points to 4073.2. Not surprisingly, the yen is keeping with it's trend and gaining as a measure of risk aversion. Patricia Gacis, strategist with ANZ Markets said, "The JPY is surging again on risk aversion in line with the slide in stock markets." Against the yen, the U.S. dollar is currently down 0.61 points to 99.20 and the Canadian dollar down 1.11 points to 85.68. The Australian dollar is suffering along with all high yielding currencies, said Peter Pontikis, strategist with Suncorp. The Aussie is currently down 1.90 cents to 0.6652 against the USD and down 1.65 cents to 0.7702 against the Canadian dollar. The euro was down 0.40 cents to 1.3565 USD. Strength in Asian bonds are also confirming the massive flight to safety. Economists at DBS said, "Asian bond markets (with the expectation of Indonesia) are rallying as the deepening of the global financial crisis is prompting growth concerns to intensify and is rendering policy easing more likely." Yields on Australian 10-year bonds are down 5.1 bps to 5.04 % and Japanese 10-year government bonds are up 4.8 bps to 1.51 %. Yields on three-year Australian bonds are down 11.0 bps to 5.31 and the Australian 90-day March 09 contract is up 31.0 ticks to 95.45. The Euroyen March 09 contract is up 7.0 ticks to 99.28. All data taken at 9:38 p.m. EDT. By Megan Ainscow,
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