Asian Stocks Head Lower For A Second Day

Asian trade: Asian stocks head lower for a second day, following the momentum from the European and U.S. markets. It looks like the equity markets have been struck by the poor economic releases coming from the major economies again.

A Bloomberg report shows that hedge funds had their worst year in 2008. The industry finished the year down by 18.3%, the most since tracking first begun in the early 1990’s. The previous worst performance was in 2002, when hedge funds tumbled on average 1.45%. This industry lost almost 45% from its peak reached in June 2008, affected by widespread losses and withdrawals.

The worst performing funds were equity hedge funds, which lost on average 26%, followed by funds of funds, which tumbled about 20% last year. However, macro hedge and futures funds, whose trades are based on investment decisions made by computer software programs, had positive earnings last year. Commodity hedge funds also posted record declines in 2008, led by the huge selling in the crude’s market.

Tonight, the Nikkei declined for the second day in a row, losing 88.70 points (0.94%) to 8,792.72. The Australian S&P/Asx gained 15.80 points (0.43%) to 3,710.10. The major equity markets turned into the red after the poor labor market results. It looks like a downturn would be even more dramatic than previously thought.

Crude oil is heading lower again, as consumption is set to drop. Crude oil for January delivery fell $0.10 to $42.40.

Gold is trading just above the 200-day moving average. Bullion for immediate delivery fell $2.30 to $853.55.

Previous Wall Street trade: U.S. equity markets ended mixed on Thursday, with the NASDAQ rising on hopes the Obama administration's economic package will boost spending on technology. The S&P, after falling to a loss on the year during today's session, finished above water with a 0.71% gain for 2009. On the day, the S&P rebounded from a 1.1% loss. The DOW is now down 0.33% on the year.

In other news, U.S. consumer borrowing fell by a record $7.9 billion in November after falling by $2.8 billion in October as a worsening job market and falling values in homes and 401k accounts hurt confidence. Total outstanding consumer credit fell to $2.57 trillion, the Federal Reserve said today. The Fed’s report doesn’t cover borrowing secured by real estate.

Previous European trade: In Europe, the U.K. Ftse fell 2.14 points (-0.05%) to 4,505.37, while the German Dax lost 57.56 points (-1.17%) to 4,879.91.