Asian markets dropped early Monday amid fears of a spreading European debt crisis after a ratings agency placed Italian banks on a review for a possible downgrade.
Japan’s Nikkei 225 fell 0.9 percent to 9,595.18. South Korea’s Kospi lost 0.9 percent to 2,072.87, and Hong Kong’s Hang Seng slipped 0.6 percent to 22,041.21.
Technology shares were among those facing the biggest slumps. South Korea’s Hynix Semiconductor, one of the world’s leading computer chip makers, was 3.9 percent down. Japanese chipmaker Elpida Memory slipped 2.1 percent, and Taiwan Semiconductor Manufacturing lost 1.4 percent.
Benchmarks in Australia, Singapore, Indonesia and Taiwan were also lower. Mainland Chinese shares were higher.
On Friday, Italian banks were down sharply on the Milan stock exchange after ratings agency Moody’s said it was considering downgrading their credit worthiness.
Moody’s Investors Service placed the long—term debt and deposit ratings of 16 Italian banks and two Italian government—related financial institutions on review for possible downgrade.
On Wall Street, stocks fell Friday after poor earnings reports from two major technology companies suggested that companies invested less in new technology as the economic recovery slowed.
Fears of a spreading European debt crisis also weighed on markets. Italian bank stocks plunged and trading in some of them was halted after Moody’s warned that it might downgrade their credit ratings.
The Dow Jones industrial average fell 1 percent to 11,934.58. The Standard & Poor’s 500 index fell 1.2 percent to 1,268.45. The Nasdaq composite fell 1.3 percent to 2,652.89.
The decline erased all of this week’s gains for the Dow Jones industrial average and S&P index. The broad stock market has now fallen for seven of the last eight weeks, largely because of concerns that the U.S. economy is slowing and that Europe’s debt problems may lead to another financial crisis. The S&P 500 is down 7 percent since it hit a high for the year on April 29.
Technology stocks were broadly lower. Micron Technology Inc. fell 14.5 percent after the company said lower sales of computer chips hurt its earnings, which were far less than analysts had expected. Oracle Corp. fell 4 percent after its sales of computer hardware fell sharply. Cisco Systems Inc. fell 3.5 percent, and Microsoft Corp. lost 1.3 percent.
The U.S. economy has cooled since late April. Recent reports on housing, employment, manufacturing and retail sales all have been weak. The debt crisis in Greece and fears that China’s growth is slowing have also pushed markets lower.
In energy trading, benchmark crude for August delivery dropped 58 cents to $90.58 a barrel on the New York Mercantile Exchange. The contract settled at $91.16 per barrel on the Nymex on Friday.
In currencies, the euro weakened $1.4130 from $1.4171 on Friday in New York. The dollar ticked up to 80.72 yen from 80.52 yen.
