Hong Kong Red ink flowed through Asian stock markets early Monday as war fears heightened the anxiety of traders awaiting Wall Street's response to the terror attacks that kept U.S. exchanges closed for four days.
"In uncertain times, all markets tend to react on the negative side," said Paul Xiradis, equities director at Ausbil Dexia in Sydney, Australia, where the blue chips were down by 3.9 percent in the early afternoon.
"We saw that expressed in the European markets on Friday night where we saw hefty moves on the negative side," Xiradis said.
In Tokyo, the 225-issue Nikkei Stock Average was plunged by 488.20 points, or 4.88 percent, to end the morning session at 9,520.69.
Hong Kong's Hang Seng Index showed quick early losses of 4 percent.
Prices tumbled by 4.8 percent in early Singapore dealings, with losses of more than 4 percent in the Taipei and Wellington markets as well. Seoul shares were off by 2.2 percent, and the South Korean government said it would ease the regulations on companies buying back their own shares.
"This is ugly," said David Kim, general manager of international business at Seoul Securities.
The New York Stock Exchange was set to reopen on Monday after being shut by the attacks last Tuesday on the World Trade Center and the Pentagon, and Asian traders had to make their bets beforehand, because New York markets don't open until well after the Asian exchanges close.
There is much speculation that the United States will soon retaliate, perhaps against targets in Afghanistan, where the man identified by Washington as a prime suspect in the attacks, alleged terrorist mastermind Osama bin Laden, has been based for several years.
In neighboring Pakistan, the authorities decided to shut down stock exchanges in Karachi, Lahore and Islamabad from Monday through Wednesday.
Many traders expect the U.S. Federal Reserve to try to cushion any blows by a quick cut in interest rates.
But with New York closed, markets have been languishing in uncertainty elsewhere around the world.
Some experts believe the economic fallout from the terror attacks will seriously aggravate the global slowdown, although it is impossible to say just how bad the effects will be.
European shares took some major hits on Friday, with blue chips off by 3.8 percent in London, 6.3 percent in Frankfurt and 5 percent in Paris.