Asian Shares Slump After Credit Suisse Buyout

Asian stocks tumbled on Monday amid signs of a deepening crisis in the financial system, lingering fears of a global recession and anxiety ahead of a Federal Reserve meeting this week.

Regulators in Asia issued reassuring statements that their banking systems remained robust and stable after a historic state-backed rescue of troubled lender Credit Suisse by Swiss rival UBS Group.

In addition, New York Community Bank NYCB agreed to buy a significant chunk of the failed Signature Bank in a $2.7 billion deal.

The U.S. Federal Reserve and other major central banks announced coordinated measures to improve banks’ access to dollar liquidity.

Deepening risk aversion benefited the dollar and gold breached the $2,000 an ounce threshold, while oil extended last week’s losses on demand worries.

Chinese stocks fluctuated before closing lower as the country’s central bank left its interest rates unchanged but cut the CRR by 25 basis points in an effort to spur growth. The Shanghai Composite Index dropped 0.5 percent to 3,234.91.

Hong Kong’s Hang Seng Index plunged 2.7 percent to close at 19,000.71, with HSBC Holding shares falling more than 6 percent.

Japanese shares fell sharply amid worries about a potential global banking crisis and key inflation data for February due this week. The Nikkei 225 Index tumbled 1.4 percent to 26,945.67, while the broader Topix closed 1.5 percent lower at 1,929.30.

Banks Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group and Mizuho Financial Group fell around 2 percent each.

Seoul stocks ended notably lower, with the Kospi finishing down 0.7 percent at 2,379.20 on worries about the financial soundness of the global financial system.

Australian markets opened the week lower, with banks leading losses. The benchmark S&P/ASX 200 index slumped 1.4 percent to 6,898.50, while the broader All Ordinaries Index settled 1.4 percent lower at 7,085.10.

Healius soared 8.3 percent after receiving a A$1.52 billion takeover offer from Australian Clinical Labs.

Across the Tasman, New Zealand’s benchmark S&P/NZX 50 Index dropped 1.4 percent to 11,564.75.

U.S. stocks fell sharply on Friday as regional banks resumed their slide on concerns about turmoil in the U.S. banking sector.

In economic news, U.S. industrial production stagnated in February and consumer sentiment fell for the first time in four months in March, while short-term inflation expectations fell to the lowest level in nearly two years, separate reports showed.

The tech-heavy Nasdaq Composite shed 0.7 percent to snap a four-day winning streak, while the Dow tumbled 1.2 percent and the S&P 500 lost 1.1 percent.

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