China contagion sends Tokyo stocks plunging

Tokyo

FEARS of the financial and economic fallout from China's continuing stockmarket plunge caused Tokyo stocks to tumble by more than 3 per cent to a two-month low on Wednesday as investors began to grasp the full implications for Japan of the rout in Shanghai stocks.

While not a "perfect storm", the simultaneous impact of the renewed Greek crisis and the market fall in China amounts to a very damaging conjunction of events for global markets, analysts said. With Asian shares generally falling to a 11/2-year low on Wednesday as the drop in China stocks showed no sign of easing, despite official attempts to shore up the market, investors began turning to bond markets for safety, forcing down yields in Japan and elsewhere.