Asian markets plunged into chaos yesterday following the series of terrorist attacks on New York and Washington.
The Hang Seng Index in Hong Kong fell through the 10,000 point level and finished the day down 8.87 per cent, at 9,493.62.
Tokyo stocks also plummeted, prompting more firms to postpone or cancel plans to debut on Japan's already lacklustre market for initial public offerings (IPOs).
The Nikkei share average ended down 6.63 per cent at 9,610.10, its lowest close since December 1983, as the devastating terror attacks in the US sent shockwaves through global markets. It was the Nikkei's eighth-largest percentage decline in a single day.
The market gloom could cloud the prospects of giant IPOs due next month by influential think-tank Nomura Research Institute and the Japanese unit of Starbucks Corp, although both companies said the offerings were on schedule.
"More companies will be forced to postpone their planned IPOs in the face of falling market valuations," said Mr Koshi Okamura, a senior analyst at Daiwa Institute of Research.
"They may have to cancel their plans if they cannot obtain the level of proceeds that they had hoped for."
Japan's IPO market has already been affected by a series of postponements and cancellations in the face of the stagnant performance of the Tokyo stock market.
South Korean stocks were also down 12.02 per cent, to 475.6. The Malaysian, Thai and Taiwanese markets were closed for trading.
In Hong Kong, analysts spoke of a general flight from equities. "We think institutional investors are selling in preparation for redemptions," said one. "More fund redemptions are expected, and funds are fleeing US dollar assets."
With speculation building that the attack was conceived in the Middle East, oil prices - which had been trading at around $24 per barrel - surged to $30-$31 before easing back to just over $28 at 6.30 p.m. Hong Kong time.
Gold also spiked higher, with Hong Kong gold closing up at $280 to $283 an ounce, from Tuesday's close of $271.30 to $271.80.
While the enormity of the attacks has given rise to fears of a worldwide recession, the research head at Sun Hung Kai Securities in Hong Kong, Mr Joseph Tang, said the scare was unfounded.
"It's a kneejerk reaction," he said. "We don't think the terrorist attack will trigger a global financial crisis unless there is a war but we think the chances are thin."
In Hanoi, Vietnam, where trade ministers from around Southeast Asia were meeting for an annual summit, concerns were expressed that fallout from the attacks could be devastating.
