Markets in Asia fell on Friday in the aftermath of the election win by the South Korean opposition leader, Kim Dae Jung, and because of continuing uncertainties over prospects for the region.

In South Korea, the won fell by more than 10% and stocks dropped by 4%, despite Mr Kim's insistence that he would stick to a proposed $57bn IMF bailout for the troubled South Korean economy.

There is concern in the markets about how far Mr Kim is prepared to go in implementing the tough measures called for by the IMF plan.

Brokers said the market was also affected by the suspension of Shinsegi Investment Trust because of financial problems.

Kim Dae Jung's win failed to reassure the markets

As news of Mr Kim's victory reached New York, the Dow Jones industrial average fell nearly 147 points, later recovering about a fourth of the loss. Investors were worried that weak Asian economies could hurt the earnings of US multinational companies.

In Japan, the Nikkei fell sharply in the wake of another corporate collapse. The index finished down just over 846 points or 5.24%.

On Thursday, Toshoku Ltd, a food trader, filed for bankruptcy. Last month, Yamaichi Securities, one of Japan's big four brokerage firms, collapsed.

Investors say that the collapse of Toshoku has raised fears that Japanese banks have tightened their lending policies so stringently that the economy could face the risk of deflation.

The markets in Japan also appeared to be unimpressed by a package of measures announced earlier in the week by the Japanese Government to stimulate the economy.

The fall in the Nikkei also knocked down shares elsewhere on Friday.

The market in Australia fell, with the All Ordinaries index down 35 points.

In Hong Kong, stocks were hit by the overnight drop in Wall Street and by the slide in other Asian markets.

The Hang Seng index dropped by nearly 354 points or 3.29%.
 

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