Asian stocks brace for torrid week


The U.S. woes are creating a drag on the struggling Japanese economy

(CNN) -- Asian financial markets are bracing for another wild week after U.S. stocks plunged again at the weekend, sparking fears of a 1987-style crash on Wall St.

Main indexes in the Asian region have opened sharply lower Monday after the key Dow Jones stock index plunged more than 4.5 percent in New York on Friday to reach its lowest point since 1998.

The Dow now sits at 8019 points, with further falls predicted when the U.S. markets re-open.

Around the Asia Pacific markets Monday morning, Japan's Nikkei index shed 1.8 percent on the opening to 10,019 points, Australia's S&P/ASX200 lost 1.64 percent, South Korea's Kospi fell 3.88 percent and New Zealand's Top 40 index slipped 2.24 percent.

The specter of a repeat of the October 1987 "Black Monday" crash prompted chairman and CEO of the New York Stock Exchange Dick Grasso to call for a "war against terrorism in the board room" to boost investor confidence and reverse last week's dramatic slumps.

The 1987 market crash saw the Dow Jones index plummet 508 points or 22 percent on the Monday following a 108-point-drop the previous Friday.

Grasso said Sunday a "small number" of bad executives had soured the investing public, but he remained optimistic.

"Investors unfortunately have been disappointed by a number of failures on the part of some companies to be truthful and honest," Grasso said.

Dismal Friday


Samsung posted record figures for the second quarter but investors took that as time to sell

"But the market has historically always responded to the economy, and the economy is strong."

In the short term however, the U.S. woes spell only bad news for Asian markets.

Asian stocks ended the week with a thud on Friday. Japan fell the hardest, having gained the most the day before.

The tech-fueled Nikkei index slumped 2.82 percent to 10,202.36, feeling another sag in Sony's stock.

The broad market declined on big caps and brokerages. The Topix broke below 1,000 again, falling 2.02 percent to 989.71.

South Korea fell almost 2.5 percent, with Samsung taking Sony's path down. Taiwan, Australia and Hong Kong all fell a little over 1 percent. Singapore closed 1.25 percent lower.

'Pretty ugly'

The Dow Jones meanwhile has now fallen more than 20 percent for the year, including 7.7 percent in the last week.

U.S. investors are now looking for just about anything to break the selling spell as a slew of corporate earnings reports hit the news wires.

"It was pretty ugly [last week]. We've got a lot of earnings to get through in the next week. I'm hoping there will be an absence of bad news and maybe that can help us," Ross Margolies, portfolio manager at Salomon Brothers Asset Management, told CNNfn.

Of the more than 20 percent of the Standard & Poor's 500 companies that have already reported quarterly profits, 60 percent have topped estimates, 28 percent have met estimates, and 12 percent have missed, according to First Call, which tracks Wall Street profit forecasts.

Companies due to release results this week include Dow components 3M and American Express, as well as AOL Time Warner and Martha Stewart Living Omnimedia.