Hong Kong, Shanghai Markets Fall On ECB Remarks

Hong Kong shares finished the morning sharply lower Friday as a cut in the European Central Bank's growth forecast fanned concerns about the global economy.

The Hang Seng Index sank 1.5 percent, to 28,347 by the break.

On the mainland, the Shanghai Composite Index dived 2.9 percent, to 3,016, while the Shenzhen Composite Index, sank 1.7 percent, to 1,639.

Tokyo headed into the break 1.5 percent lower. Sydney sank 0.8 percent and Singapore 0.5 percent, with Seoul and Taipei each 0.9 percent off.

The ECB said interest rates would be stuck around historic lows until the year's end at best, with bank boss Mario Draghi warning the eurozone was "coming out of, and maybe we still are in a period of continued weakness and pervasive uncertainty".

That sent the euro into a tailspin to hit a near two-year low against the US dollar.

"With the eurozone likely the next target for [Donald] Trump's trade-talk embrace, a slowing economy, a central bank very low on monetary bullets, an inability by members to mount a joint fiscal response and an impending Brexit ... it is no surprise that the euro fell out of bed," said OandaA senior market analyst Jeffrey Halley.

The single currency was unable to claw back any of Thursday's losses during early Asian business, and the rush to safe investments by traders kept riskier, higher-yielding units beaten down. (AFP)

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