Asian stocks weaker on Wall Street, Sony surprises on upside

A A A - - Stocks in Asia fell on Friday, with Australia leading the losses.

The S&P/ASX 200 lost 1.2% in Sydney after stocks on Wall Street experienced their biggest one-day decline since February. Elsewhere in Asia, Japan's Nikkei 225 lost 0.5% and South Korea's Kospi was 0.2% lower.

The earnings season rolled on in Japan, with Sony Corp. jumping 5.5% higher in Tokyo after the electronics firm posted a small net profit in the quarter ended June 30, defying analyst expectations of a loss.

Overnight, U.S. stocks dropped on concerns that labor costs are on the rise in the U.S. while fears that Argentina's default on its debts may roil markets with contagion fears adding to the selloff.

The Dow 30 fell 1.88%, the S&P 500 index fell 2.00%, while the NASDAQ Composite index fell 2.09%.

Argentina earlier failed to agree to debt restructuring terms with creditors and fell into its second default since 2002, which sent stocks prices tumbling despite solid U.S. data.

Fears the Argentine default will roil markets already sensitive to conflict in Ukraine, Gaza and elsewhere in the Middle East bruised all three major indices.

Rising labor costs in the U.S. exacerbated the meltdown by reminding investors interest rates will go up in the U.S. possibly at a time when the global economy faces clouds on its horizon.

The Labor Department reported earlier that its employment cost index rose by 0.7% in the three months to June after a 0.3% increase in the first quarter. Economists had expected a 0.5% gain.

The Labor Department also reported that the number of individuals filing for unemployment assistance in the U.S. last week rose by 23,000 to 302,000 from the previous week's total of 279,000. Analysts had expected jobless claims to rise by 22,000 to 301,000.

Hopes that Friday's July jobs will report will come in solid took a backseat to Argentine financial woes and fears of subsequent contagion.

On Friday, markets will move on the U.S. nonfarm payrolls and the unemployment reports, while the Institute of Supply Management is to release data on manufacturing activity. offers an extensive set of professional tools for the financial markets.
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This article appears in: Investing , Forex and Currencies

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