The news that Bear Stearns (NYSE: BSC) was sold to JP Morgan (NYSE: JPM) and that the Fed would increase liquidity for primary dealers was too much for the Japanese market to bear. It sold off 3.4% in the opending minutes and is likely to be followed by drops in exchanges in China and other Asian countries as they open for Monday morning trading.
Hitachi opend down 8.3% to 623 yen. Mazda was down 4.8% to 341. NEC was off 5.1% to 376. Toyota (NYSE: TM) traded off 3.3% to 4920.
If US exchanges give up similar numbers, the Dow could easily open down over 300 points with some financial shares suffering sharper losses.
Douglas A. McIntyre