Dubai Financial Troubles.
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Asian stock markets tumbled Friday as the dollar continued its slide against the Japanese yen and worries over losses from Dubai's debt problems unnerved investors worldwide.
It was the region's second day of losses and followed a rout in European markets. Oil, meanwhile, dived below $76 a barrel.
Investors cut back their riskier bets on equities and commodities after Dubai World, the emirate's main development engine, announced it was asking creditors to delay paying back its $60 billion debt. The news triggered fears of a massive default and a wave of heavy losses at banks and companies holding its debt.
Also dampening the mood was the slumping dollar, which weakened to a new 14-year low below 85 yen, dragging down shares of Japan's exporters like automaker Nissan and electronics maker Sharp.
"Investors were searching for shelter against the increased volatility and falls in risky assets," Dariusz Kowalczyk, chief investment strategist for SJS Markets in Hong Kong, said in a note. "Many chose to opt for the Japanese yen."
In Tokyo, the Nikkei 225 stock average fell 184.94 points, or 2 percent, to 9,198.30 and Hong Kong's main index retreated 712.04 points, or 3.2 percent, to 21,501.41.
Elsewhere, South Korea's Kospi benchmark lost 2.6 percent to 1,557.45 and Australia's index dropped 2.8 percent. China's main Shanghai stock measure was off 1.1 percent.
Uncertainty over the fallout from Dubai World's financial troubles sent European markets plummeting Thursday, with benchmarks in Britain, Germany and France all losing more than 3 percent.
US markets were closed Thursday for the Thanksgiving holiday. But Friday was likely to be a rough session on Wall Street with futures pointing sharply lower. Dow futures were down 192, or 1.8 percent, to 10,250.
Oil prices retreated in Asian trade, with benchmark crude for January delivery falling $2.01 to $75.95 a barrel.
The dollar was lower at 86.13 yen from 86.54 yen after swooning as low as 84.81. The euro fell to $1.4931 from $1.5021.