By Coco Alcuaz -
Asian stocks slumped early Friday, following U.S. and European markets, after the European Central Bank did less than some investors hoped to boost the region's economy. Japan's Nikkei 225 fell 1.5 percent, Korea's KOSPI 1.1 percent, Australia's ASX 200 1.9 percent and New Zealand's NZX 50 1.25 percent.
On Thursday in the U.S., the Dow Jones Industrial Average, Standard & Poor's 500 and Nasdaq composite index all fell more than 1.4 percent. In Europe, Britain's FTSE was off 2.3 percent, while Germany's DAX and France's CAC 40 both fell 3.6 percent.
"The biggest influence was the Draghi talk this morning; it didn't satisfy the U.S. markets," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia, as Reuters reported.
The European Central Bank, led by Mario Draghi, said it would extend its 60 billion euro ($65.6 billion) monthly bond-buying program for six months, and include local and regional bonds and a 0.1 percentage-point cut in its deposit rate to negative 0.3. Some investors were counting on an increase in the bond-buying and a bigger rate cut, Bloomberg reported.
“The market was hoping for some Draghi magic, but instead got some Draghi shock,” said Mitsuo Shimizu, deputy general manager at Japan Asia Securities Group Ltd. in Tokyo, as Bloomberg reported. “I’d thought that for a recovery in the European economy we’d need some bold easing measures, but since Draghi seems to be taking the economic recovery lightly, it’s possible that it could take a turn for the worse for some time.”