Tokyo knocked by US and ratings woe

FURTHER ominous signs that America's recovery was already faltering, raising fears of stagnant sales and dwindling profits for Asian exporters hit markets around the region today. The Nikkei 225 Average slid 189.03 points to 9599.10 as the holiday in

A fall in the value of the yen, which is positive for exporters' stocks, proved no tonic. Selling reflected a warning from ratings agency Standard & Poor's that the country's credit rating was at risk once again because of the lack of real progress on the long-promised reforms to the economy and banking system.

In April the agency caused outrage in Tokyo when it cut Japan's rating to AA minus, down among those of third world countries, and today Standard & Poor's repeated criticism of feet-dragging did more damage. 'While the government has made limited progress in several areas, many of these painful decisions - such as those concerning public sector reform, fiscal policy, and the banking system - have been postponed,' reported S&P.

Stock selling in Tokyo was concentrated on enterprises with big exposure to the US market, and Toyota was among the biggest fallers with a drop of almost 3%.

The collapse of the Nasdaq Japan joint venture wiped almost 2% off the shares of Softbank, the internet investing group which has a 43% stake in the trading system.

Hong Kong stocks also dipped ahead of what are expected to be gloomy unemployment figures. These will confirm that the local economy faces problems, which will be deepened by a US double-dip recession. The Hang Seng index fell 18.1 points to 10,247.

Trading was subdued as analysts warned that unemployment figures for the three months to the end of July, to be released when the market closed, could go as high as 8%, up from a record 7.7% in the previous quarter.

The feel-bad factor engendered by the rising jobless figures is being felt in every sector, from retail sales to restaurant turnover and property prices, while credit-card defaults are soaring.

An early surge in South Korean stocks on signs that chip prices are bottoming out was swiftly sliced back by retail selling, leaving the Kospi up 0.55 at 718.84. A similar trading pattern was seen in Taiwan, where gains in semiconductor stocks were countered by falls in other sectors, which left the Weighted Average showing a net fall of 28.24 points to 4890.78.

Sydney stocks continued their recent bullish run, with the All Ordinaries index up 64 points to 3148.2. Prospects of brighter earnings from News Corp, after big write-offs, lifted the stock more than 3%. Financial services group AMP, with big investments in the UK insurance industry, rose almost 3% ahead of half-year results on Thursday.

Singapore's Straits Times index put on 17.2 points to 1539.8 as bargain-hunters moved in, but the Kuala Lumpur Composite index drifted down 1.79 to 734.81. In Thailand, the SET index lost 3.50 to

369.53, while the Jakarta Composite slipped 1.35 points to 449.64.

Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed in the tables.