It was a dismal session for Asian stocks Monday, with markets dragged down by financial counters. Japan finished almost 4 percent lower. South Korea shed nearly 3 percent and Australia declined for the 11th straight session, down 2.9 percent.
Worries about the U.S. economy kept the U.S. dollar within striking distance of a near three-year low against the yen as investors unwound risky currency carry trades, and Japanese government bond futures rose to a two-year peak as investors sought a safe haven in the face of deteriorating economies and slumping stocks.
Financial sector stocks were hit hard, after their U.S. peers absorbed the brunt of Friday's selling on concern over the spreading fallout from the subprime mortgage crisis. Citibank's Japan shares, South Korea's Kookmin Bank, Australia's Westpac Bank, and Singapore's DBS Group were all sharply lower.
President George W. Bush called for an economic stimulus plan worth up to $150 billion in tax cuts and other measures to bolster the U.S. economy on Friday, but U.S. stocks fell on fears
it was not enough to prevent a recession. All the major U.S. stock indexes fell, closing out the worst week for the S&P 500 in five years. U.S. stock markets will be closed on Monday for a public holiday.