TOKYO, Jan. 22--Global stock markets extended their shakeout into a second day on Tuesday, plunging amid fears that a possible US recession will cause a worldwide economic slowdown.
The dramatic declines in Asia and Europe were expected to spread to Wall Street, where stock index futures were already down sharply hours before the trading day began, AP wrote.
Japan’s Nikkei 225 index nosedived 5.7 percent--its biggest percentage drop in nearly 10 years--to 12,573.05, a day after falling 3.9 percent. Australia’s benchmark index sank 7.1 percent, its steepest slide in nearly 20 years. Hong Kong’s Hang Seng index, which slumped 5.5 percent on Monday, was down 8.2 percent in afternoon trading.
In China, the Shanghai Composite index lost 7.2 percent to close at its lowest level since August.
Indian Finance Minister P. Chidambaram urged investors to remain calm after trading in Mumbai was halted for an hour when the stock market there fell 10 percent within minutes of opening.
In volatile afternoon trading, the Sensex was down 6.2 percent. “There is no reason at all to allow the worries of the western world to overwhelm us,“ Chidambaram said.
Investors across the region dumped shares in frenetic trading on worries that the US economy, battered by a credit crisis and housing slump, will shrink in coming months, weakening demand for Asian exports.
Markets have been plunging amid pessimism about the ability of American authorities to prevent a recession. The Federal Reserve has indicated it will lower interest rates further, and President Bush has proposed an economic stimulus package that includes $145 billion in tax cuts, but investors around the world are doubtful that the measures will lift the economy quickly.
“Unless we get some positive ’shock effects,’ such as drastic measures from the US government, there is almost no hope for a recovery in stocks,“ said Koji Takeuchi, senior economist at Mizuho Research Institute in Tokyo.
Oil and gold prices also fell. Light, sweet crude for February delivery fell to $87.72 a barrel on expectations that slower US growth will lead to less demand for crude. Spot gold, which usually benefits from market uncertainty, fell to a two-week low of $855.20 per troy ounce.
Wall Street future prices were down sharply on Monday, portending a plunge when trading begins at 9:30 a.m. Eastern time.
Dow Jones industrial average futures were down 621 points, or 5.1 percent, to 11,485, while Standard & Poor’s 500 futures were down 70 points, or 5.3 percent, at 1,255.
Noritsugu Hirakawa, who monitors stock trading at Okasan Securities Co. in Tokyo, said investors were spooked by the drastic falls on Chinese and Indian markets--the two emerging economies that are viewed as sustaining global growth even as the US economy sputters. “The end to the slides in Asian stocks is nowhere in sight,“ he said. “There is even speculation that China may be exposed to the US subprime mortgage crisis.“
In Europe on Monday, investors also dumped stocks, sending the Britain’s benchmark FTSE-100 down 5.5 percent and France’s CAC-40 Index sliding 6.8 percent. Germany’s blue-chip DAX 30 plunged 7.2 percent to 6,790.19.
That sell-off continued Tuesday throughout Asia, with benchmark indices in South Korea, Taiwan, Singapore and the Philippines all falling more than 4 percent. Indonesia’s market sank 8.5 percent.
Asian markets have been in a downward spiral for most of January. Since the start of the year, Japan’s Nikkei index has tumbled nearly 18 percent, while the Hang Seng is down a stunning 21 percent.
Even the usually upbeat Japanese Economy Minister Hiroko Ota acknowledged that threats were growing.
Top European finance officials sounded the alarm on Monday about a possible US recession as fears about the health of the world’s biggest economy plunged global stocks deep into the red, AFP wrote.
“The situation is continuing to deteriorate in the United States,“ Luxembourg Finance Minister Jean-Claude Juncker said after chairing a meeting with counterparts from the 15 countries sharing the Euro.
“We are all concerned. We are following the events on a daily basis, we hope things will not be as bad as they may look,“ said Slovenian Finance Minister Andrej Bajuk, whose country holds the rotating EU presidency.
In related news, International Monetary Fund head Dominique Strauss-Kahn warned Monday that the global economic situation in the wake of a US slowdown was “serious“ and could impact the world’s emerging economies.

TEHRAN, Jan. 22--Iranian, Egyptian and Syrian presidents condemned the recent crimes of the Zionist Israeli regime in the Gaza Strip.
The telephone conversation late Monday between President Mahmoud Ahmadinejad and his Egyptian counterpart Hosni Mubarak is the latest sign of improvement in relations frozen since 1980, IRNA reported.
The two presidents underscored the need for helping the innocent Palestinian people in the Gaza Strip treat the injured.
“Our responsibility gets heavier whenever one more Palestinian is martyred,“ President Ahmadinejad said. “The time is ripe for assisting the Palestinians survive this intolerable situation.“
He further underlined the need for cooperation among all Muslim states regarding the Palestinian issue.
Briefing his Iranian counterpart on the latest developments in Gaza, President Mubarak called for rapid dispatch of food, fuel and medicine to the people of Gaza.
Diplomatic ties were broken a year after the 1979 Islamic Revolution in protest at Egypt’s recognition of Israel and hosting the deposed shah.
Also on Monday, Ahmadinejad talked on the phone with his Syrian counterpart on Monday to talk on the Gaza situation.
Ahmadinejad and Bashar Al-Assad stressed that the people of Gaza are currently under heavy pressures and the Muslim countries should do their best to help cease the Zionists’ crimes in the Gaza Strip.
In related development, ten Iranian lawmakers, in a written note to President Mahmoud Ahmadinejad on Tuesday, called for holding an emergency meeting of the Organization of Islamic Conference.
The MPs called for an OIC session to confront the new wave of Zionist brutality against the Palestinian people in the Gaza Strip.
The note was read by Majlis Speaker Gholamali Haddad Adel during an early Majlis session.
Foreign Minister Manouchehr Mottaki on Sunday drew the OIC attention toward the current situation in Gaza Strip.
In separate messages to the OIC Secretary-General Ekmeleddin Ihsanoglu and several OIC foreign ministers, Mottaki condemned the Zionists’ brutality.

TEHRAN, Jan. 22--Secretary of Supreme National Security Council Saeed Jalili left Tehran for Brussels on Tuesday to address the European Parliament.
Ali Baqeri, deputy foreign minister for Euro-American affairs, is accompanying Jalili, IRNA reported.
According to the SNSC’s Public Relations Office, the European representatives will be briefed on Iran’s latest standpoints regarding Iran-EU interaction in future.
Iran’s top nuclear negotiator will also attend a meeting at Belgium’s Royal Institute of International Relations.
Jalili will outline Iran’s viewpoints regarding international and regional issues, the peaceful nuclear program, Tehran-Brussels ties and Iran-EU relations.
European diplomats, elites, researchers and academics are expected to attend the meeting.
During his stay, Jalili is also scheduled to hold talks with several senior Belgian officials.
The European Parliament consists of 785 deputies from 27 EU member-states.

SEOUL, South Korea, Jan 22--North Korea on Tuesday again blamed the US for a deadlocked denuclearization deal, saying it would not retreat in the face of US confrontation.
Minju Josun, the cabinet newspaper, singled out Washington’s failure to start the process of removing Pyongyang from its list of state sponsors of terrorism, AP reported.
North Korea missed a December 31 deadline to disable its main atomic facilities and give a full declaration of all nuclear programs, as required under a six-nation accord.
In response to the disabling and declaration, negotiating partners--South Korea, the US, China, Japan and Russia--were to supply one million tons of fuel oil or equivalent energy aid.
The US was to start the process of removing the North from the terrorism list, which blocks access to bilateral economic aid and to loans from the World Bank and other international financial institutions.
The newspaper’s commentary said: “The US, which pledged...to take our country off the list of states sponsoring terrorism by the end of last year, is still reluctant to implement the promise.“
“If the US really intends to make progress in denuclearizing the Korean peninsula, it should fulfill its obligations,“ it added.
“It is nonsense to say that the denuclearization of the Korean peninsula is being delayed because we did not make a nuclear declaration, given that they fail to do what they are supposed to do.“
Last week another official newspaper, Rodong Sinmun, accused US hardliners of trying to wreck the deal and said the issue would never be settled if they resume pressure tactics.
“We have never shrunk from the US policy of confrontation. We have always responded to the US hardline policy with an ultra-hardline policy,“ Minju Josun said on Tuesday.

BEVERLY HILLS, USA, Jan. 22--“No Country for Old Men“ and “There Will Be Blood“ led with eight Academy Awards nominations each on Tuesday, among them best picture and acting honors for Daniel Day-Lewis and Javier Bardem, but whether any actors would show up was in doubt because of the writers strike.
“No Country for Old Men,“ a crime saga about a drug deal gone bad, “There Will Be Blood,“ and a historical epic set in California’s oil boom years will compete for best picture against the melancholy romance “Atonement,“ the pregnancy comedy “Juno“ and the legal drama “Michael Clayton“, AP reported.
“Atonement“ and “Michael Clayton“ trailed with seven nominations each, including best actor for George Clooney in the title role of “Clayton“. The lead players in “Atonement,“ Keira Knightley and James McAvoy, were shut out on nominations, however, with teenager Saoirse Ronin the only performer nominated for that film, for supporting actress.
Past Oscar winner Cate Blanchett had two nominations as best actress for the historical pageant “Elizabeth: The Golden Age,“ and the Bob Dylan tale “I’m Not There“.
The acting categories generally played out as expected--with a few surprises, including best actress nominee Laura Linney for “The Savages“ and best-actor nominee Tommy Lee Jones for “In the Valley of Elah“. Neither performance had been high on the awards radar so far this Oscar season.
Best actress looks like a two-person duel between Julie Christie, an Oscar winner for “Darling,“ as a woman succumbing to Alzheimer’s in “Away From Her“ and Marion Cotillard as singer Edith Piaf in “La Vie En Rose“. Both won Golden Globes, Christie for dramatic actress, Cotillard for musical or comedy actress. Yet they face strong competition from Blanchett, Linney and relative newcomer Ellen Page as a whip-smart pregnant teen in “Juno.“
Day-Lewis, an Oscar winner for “My Left Foot“, grabbed another best-actor nomination as a flamboyant oil baron in “There Will Be Blood“, for which he could emerge as the favorite.

ROME, Jan. 22--Italy’s Premier Romano Prodi sought support for his teetering government in parliament on Tuesday and said he would ask for votes of confidence in both chambers after a coalition ally withdrew support.
A loss in either chamber would force Prodi to resign, AP reported.
The withdrawal of the Udeur Party’s support Monday night cost Prodi’s government its one-vote majority in the upper chamber, the Senate. Prodi said he would ask for a confidence vote there, as well as in the lower Chamber of Deputies, where his coalition has a majority.
In a briefing to the Chamber of Deputies, Prodi listed what he considered the successes of his 20-month-old administration, including economic growth and a decrease in debt. He said tax cuts and salary increases were planned.
“Important projects await us, which we responsibly started without thinking that occasional decisions could put them into question,“ Prodi said to both cheers and heckles from lawmakers.
He called for a “continuity of action“ in challenging lawmakers to decide the future of his government.
A vote in the lower chamber was scheduled for Wednesday. No date has been set for the Senate vote, but reports suggested it could be as early as Thursday.