Asian Markets Lower on Europe Contagion Fears

Asian markets slipped again on Friday as traders grew increasingly concerned the Eurozone crisis will soon envelope larger economies after borrowing costs for France and Spain shot higher.

Tokyo finished 1.23 percent, or 104.72 points, lower at 8,374.91 and Sydney fell 1.91 percent, or 81.2 points, to end at 4,177 while Seoul finished 2.00 percent, or 37.50 points, lower at 1,839.17.

Hong Kong lost 1.73 percent, or 326.24 points, to end at 18,491.23 and Shanghai ended down 1.89 percent, or 46.49 points, at 2,416.56.

"There's been no let-up in the European debt crisis and there's no sign of officials deciding anything that's going to calm markets," said Macquarie Private Wealth investment adviser James Rosenberg in Sydney.

"It's a long road back to improving sentiment," he told Dow Jones Newswires.

As the yield on Italy's 10-year government bonds once again topped the 7.0 percent level considered unsustainable for the government to service its huge debts, fears were growing that Spain and even France could be next in line.

In auctions Thursday Paris and Madrid saw their cost of borrowing jump.

Spain had to pay a record 6.975 percent when it raised 3.6 billion Euros in a sale of 10-year bonds.

And in France, the bloc's second-largest economy, the spread between 10-year bonds and the equivalent German issue hit 200.6 basis points, or 2.006 percentage points.

That means Paris must now pay more than twice as much as Germany to borrow.

"Deepening European sovereign-debt problems weigh on stocks globally," said Hiroichi Nishi, general manager of the equity division at SMBC Nikko Securities.

The crisis shows no sign of letting up and divisions between the European leaders continued to show as officials in Berlin came under pressure to allow the European Central Bank to play a bigger role in helping struggling economies.

And on Friday Japan called on Germany -- Europe's biggest economy -- to play a leading role in dragging the region back from the brink.

In Italy, new Prime Minister Mario Monti's technocrat government eased through a confidence vote hours after the former EU commissioner laid out radical reforms to cut Rome's huge debt burden.

German Chancellor Angela Merkel told Monti that "great hopes and expectations are directed at you".

"You and your government are called upon to quickly decide and implement crucial and necessary reform measures," Merkel said.

The debilitating crisis continued to press U.S. stocks. On Wall Street, the Dow closed down 1.13 percent, the S&P 500 fell 1.68 percent and the Nasdaq lost 1.96 percent.

In morning trading Friday, London's FTSE 100 index sank 0.92 percent, Frankfurt's DAX 30 shed 0.99 percent, while in Paris the CAC 40 dropped 0.69 percent.

The euro fetched $1.3513 and 103.71 yen, compared with $1.3457 and 103.60 yen in New York late Thursday.

The dollar was at 76.74, from 76.80 yen.

The commodities-based Australian dollar fell below parity to the greenback for the first time since October 10, hitting a low of 99.70 U.S. cents overnight.

Risk aversion has sent the "Aussie" falling from its record high U.S.$110.81 seen in July.

On oil markets, New York's main contract, light sweet crude for delivery in December, shed 49 cents to $98.33 per barrel on its last trading day.

Brent North Sea crude for January delivery rose $1.53 to $109.24.

Gold was trading at $1,729.20 by 1100 GMT, compared with $1,759.26 late Thursday.

In other markets:

-- Taipei declined 2.08 percent, or 154.03 points, to 7,233.78.

HTC fell 4.20 percent to Tw$660.0 while TSMC was 1.98 percent lower at Tw$74.2.

-- Singapore shares fell 1.72 percent, or 47.91 points, to 2,730.34.

Singapore Airlines dropped 2.21 percent to Sg$10.60 and Keppel Corp tumbled 1.42 percent to Sg$9.00.

-- Indian shares fell 0.55 percent, or 90.2 points, at 16,371.51.

Engineering giant Bharat Heavy Electricals fell 3.06 percent to 275.95 rupees while troubled Kingfisher Airlines slid 3.61 percent to 24.05 rupees.

-- Kuala Lumpur shares fell 0.76 percent, or 11.07 points, to 1,454.40.

Gamuda Bhd lost 4.6 percent to 3.11 ringgit, MISC Bhd shed 3.6 percent to 6.45, UMW Holdings dipped 2.6 percent to 6.46 while Genting Malaysia rose 1.3 percent to 3.87 and British American Tobacco gained 0.9 percent to 46.70 ringgit.

Indonesian shares lost one percent or 37.75 points to 3754.50.

Bank Mandiri fell 2.9 percent to 6,800 rupiah, Bank Rakyat lost 2.2 percent to 6,650 rupiah, car maker Astra ended down one percent to 68.700 rupiah, while Bumi Resources Minerals gained 3.4 percent to 610 rupiah.

Bangkok edged down 0.93 percent, or 9.22 points, to 984.16.

Banpu fell 2.00 baht to 576.00, while PTT lost 4.00 baht to 303.00.

-- Manila dropped 0.74 percent, or 32.23 points, to end at 4,302.43.

Lepanto Mining gained 3.6 percent to 1.43 pesos and Ayala Land is off 2.6 percent at 16.48 pesos. Debut stock Cirtek Holdings rose 13.6 percent to 7.95 pesos from an IPO price of 7.00 pesos.

-- Wellington fell 0.91 percent, or 24.85 points, to 3,250.89.

Telecom Corp. fell 3.0 percent to NZ$2.45 and Fletcher Building slipped 0.16 percent to NZ$6.11. Air New Zealand was unchanged on NZ$1.04.