Eurozone uncertainty hits Asian stock markets


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The Independent Online

Asian stock markets were mostly lower today, as relief from Greece's election results evaporated amid worries that the financial crisis in the 17 nations that use the euro was far from over.

A narrow victory by Greek conservatives, who favour upholding an austerity programme that their country entered into in exchange for an international bailout, initially relaxed fears of a chaotic exit by Greece from the eurozone.

But now the focus is back on Spain, whose borrowing costs surged yesterday above the 7% level that had forced Greece, Portugal and Ireland to seek international help.

The rate reflects what return investors are willing to accept when a country auctions its bonds.

Spain's high bond yields are a sign that investors are increasingly concerned that the country will struggle to save its crippled banks.

Japan's Nikkei 225 index fell 0.4% to 8,689.79. Hong Kong's Hang Seng Index lost 0.5% to 19,325.19 and Australia's S&P/ASX 500 lost 0.5% to 4,1187.60. South Korea's Kospi was 0.1% down at 1,888.88.

Investors appeared fed up with the inability of European leaders to resolve a financial crisis that has bedeviled markets for more than three years. Leaders of the most developed countries are meeting in Mexico to discuss the crisis and the sluggish global economy.

On Wall Street, the Dow Jones industrial average closed down 0.25 at 12,741.82. The Standard&Poor's 500 index rose 0.1% to 1,344.78. The Nasdaq composite index rose 0.8% to 2,895.33.

Benchmark oil for July delivery fell 11 cents to 83.16 dollars per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 76 cents to finish at 83.27 dollars per barrel.