Asia stocks tumble on Greece woes

BANGKOK (AP) — Asian stock markets tumbled yesterday as sentiment took a hit from a weakening economic picture in Europe and Greece’s admission it won’t meet its deficit reduction target despite austerity.

In Tokyo, the Nikkei 225 slumped 2.3 percent to 8,493.24 – well below the close of 8,605.15 on March 15 in the aftermath of a destructive earthquake and tsunami that wiped out Japan’s northeastern coast. A government survey showing an improvement in business confidence among Japanese manufacturers did little to nudge stocks back to life.

Hong Kong’s Hang Seng dived five percent to 16,722.46 by the end of the morning session – its lowest level this year.

Australia’s S&P/ASX 200 fell 2.6 percent to 3,904.40. Benchmarks in Singapore, Taiwan, Indonesia, the Philippines and Thailand were all sharply lower. Markets in mainland China and South Korea are closed for national holidays.

Francis Lun, a Hong Kong-based analyst, said governments have been mishandling their economies since the 2008 financial meltdown. Greece was not given the support it needs from other countries that use the euro currency to ward off the prospect of defaulting on its debts.

Greece will run out of cash in two weeks if it does not met the criteria set down by a group of international lenders for the next installment of a financial rescue package. A default could undermine banks with significant holdings of Greece’s bonds and cause domino-style defaults in other indebted countries such as Italy.

Meanwhile, a deeper-than-expected recession prevented Greece from meeting the 2011-2012 fiscal year’s deficit target of 7.8 percent of gross domestic product, the government said. Greece’s deficit for 2011-2012 is expected to reach 8.5 percent of GDP, or euro 18.69 billion ($25.2 billion).