Asian Stocks Trading Lower

By Jeremiah Marquez

HONG KONG -- Asian stock markets fell Monday, with benchmarks in Hong Kong and South Korea off about 2%, as a jump in U.S. unemployment intensified concerns the global economy is facing a prolonged slump.

Investors were rattled by a much-anticipated report released Friday that showed the unemployment rate in the world's largest economy increased to a worse-than-expected 7.2% in December from 6.8% in November. Meanwhile, employers cut 524,000 jobs, bringing job losses for all of 2008 to 2.6 million -- the most since 1945.

While hardly surprising, the figures were still more evidence that the magnitude and duration of the global recession could be worse than many anticipated. For Asia, the news was especially unsettling as rising unemployment hurts consumer spending and erodes demand for the region's major exports.

"After the grim reminder of the U.S. labor market, I think there's the realization that it's not going to be an easy ride," said Song Seng Wun, head of research at CIMB-GK in Singapore. "Investors fear the global economy might be tanking worse than even pessimists expect."

Hong Kong's Hang Seng Index 1.9%, and and South Korea's Kospi fell 2.3%. Japan's market was closed for a national holiday.

The benchmark index in Australia fell 1.6%. Shanghai's main index rose 0.2%.

U.S. investors, also unsettled by the jobs report, sent stocks veering lower Friday.

The Dow Jones Industrial Aaverage fell 143.28, or 1.6%, to 8,599.18, logging a 4.8% decline for the week, its biggest point and percentage loss since the week ended Nov. 21. Broader stock indicators also declined, with the S&P 500 index falling 19.38, or 2.1%, to 890.35.