Asian markets down may 11 2012 effect J.P. Morgan Trading Losses

Asian markets down may 11 2012 effect J.P. Morgan Trading Losses : Most Asian markets fell as investors shunned riskier assets after a surprise $2 billion trading loss by J.P. Morgan, with slowing Chinese inflation failing to cheer markets. Japan's Nikkei was flat, Australia's S&P ASX 200 was down 0.3%, while Korea's Kospi fell 1.1%. Singapore's Straits Times Index was 0.7% lower.

Hong Kong's Hang Seng Index slipped 1.1%, while the China Shanghai SE Composite lost 0.3%.

Consumer prices in China rose 3.4% in April, matching expectations. Traders will be watching out for more data during the day, including industrial output, retail sales and fixed investment.

Sentiment was hurt by the revelation that J.P. Morgan made a $2 billion trading loss in the past six weeks.

The stock fell 6.5% in after-hours trading, with other U.S. banks falling heavily as well: Citigroup was down 3.6%, Bank of America 2.6% and Goldman Sachs 2.4%.

Problems at the U.S. banks pushed down the Australian dollar, considered a key risk asset in Asia, to $1.0062, from an earlier high of $1.0086.

"The J.P. Morgan news was the turning point, otherwise we could have seen a positive start for Asian risk assets today," said Stan Shamu, market strategist at IG Markets.

Australian banks also dropped, with Australia and New Zealand Banking Group sliding 1.1%, Westpac Banking Corp falling 0.5%, and National Australia Bank losing 0.9%.

The J.P. Morgan announcement dampened some of the overnight relief relating to the situation in Europe, as there were signs Thursday that the political deadlock in Greece might be ending, allowing for the possible formation of a government.

The Nikkei was the only market in Asia to start in positive territory, though it weakened as the day continued. Trading in Tokyo was buoyed by a number of earning reports from major corporations that came out after the close of trading Thursday.

Isuzu Motors climbed 4.5% and Nikon rose by 7.4% in early morning trading after announcing strong profits for the fiscal year ended March 31.

In the U.S., markets were cheered by upbeat employment data, with a weekly labor market report exceeding expectations.

The euro gained 0.05% against the dollar, its first rise in eight sessions, trading at $1.2936 late in New York. The single currency weakened in early Asian trading by 0.14% to 1.2912.

The dollar gained 0.4% against the yen to 79.92 -- indicating a slight move away from the safe-haven currency -- only to slip back to 79.88 in early trading .

The price of oil made a recovery Thursday, gaining 0.3% to $97.08 a barrel. In early trading Friday, crude slipped 1.1% to $96.04.

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