World Shares Retreat on Wall St. Drop  10/17 04:49

   World shares skidded Friday following a retreat on Wall Street driven by 
concerns over banks' loan portfolios.

   MANILA, Philippines (AP) -- World shares skidded Friday following a retreat 
on Wall Street driven by concerns over banks' loan portfolios.

   The future for S&P 500 fell 1.3% while that for the Dow Jones Industrial 
Average shed 1%. Oil prices were lower while the price of gold climbed to over 
$4,383 an ounce, and was last trading at $4,356.50 per ounce, as Washington and 
Beijing swapped harsh words over trade.

   In early European trading, a sell-off of bank and financial shares weighed 
on regional indexes. Germany's DAX slumped 2% to 23,783.64. Britain's FTSE 100 
fell 1.5% to 9,293.24 while in Paris, the CAC 40 shed nearly 0.8% to 8,126.52.

   In Asia, Japan's Nikkei 225 fell 1.4% to 47,582.15, tracking U.S. losses. 
Uncertainty over the choice of a new prime minister has also weighed on 
investor sentiment.

   Conservative lawmaker Sanae Takaichi was elected to head the ruling Liberal 
Democratic Party but last week's collapse of its coalition with the 
Buddhist-backed Komeito cast doubt over whether she would garner enough support 
in the lower house of parliament to prevail in a vote expected next week.

   Takaichi has led efforts to form a new alliance with the Osaka-based Japan 
Innovation Party, which would improve her chances of becoming Japan's first 
female prime minister.

   In Chinese markets, shares fell as trade tensions with Washington 
intensified. Hong Kong's Hang Seng index slumped 2.5% to 25,247.10, while the 
Shanghai Composite index slid nearly 2% to 3,839.76.

   Traders also remained cautious ahead of Monday's release of economic data 
and an important meeting of the ruling Communist Party leadership next week.

   South Korea's Kospi closed nearly flat at 3,748.89, erasing earlier gains 
amid optimism over progress in trade talks with the U.S.

   Data released on Friday showed South Korea's seasonally adjusted 
unemployment rate slid to 2.5% in September from 2.6% in August.

   Australia's S&P/ASX 200 lost 0.8% to 8,995.30, retreating from the previous 
day's record high. Energy and tech stocks led the decline.

   Taiwan's Taiex dropped nearly 1.3% while in India, the Sensex rose 0.4%.

   On Wall Street, stocks fell Thursday as worries flared over the financial 
health of midsized banks.

   The S&P 500 slid 0.6% to 6,629.07, in its latest up-and-down day. The Dow 
Jones Industrial Average dropped 0.7% to 45,952.24, and the Nasdaq composite 
lost 0.5% to 22,562.54.

   Salt Lake City-based Zions Bancorp. tumbled 13.1% after the bank said its 
profit for the third quarter will take a hit because of a $50 million 
charge-off related to loans made to a pair of borrowers. Zions said it found 
"apparent misrepresentations and contractual defaults" by the borrowers and 
several people who guaranteed the loans, along with other irregularities.

   Another bank, Western Alliance Bancorp, dropped 10.8% after saying it has 
sued a borrower, alleging fraud. It also said it's standing by its financial 
forecasts given for 2025.

   Scrutiny is rising on the quality of loans that banks and other lenders have 
broadly made following last month's Chapter 11 bankruptcy protection filing of 
First Brands Group, a supplier of aftermarket auto parts. The question is 
whether the hiccups are just a collection of one-offs or a signal of something 
larger threatening the industry.

   "The Street's been dining on rate cut and AI optimism for months, but this 
week the waiter brought something no one ordered: the return of the credit 
bogeyman," Stephen Innes of SPI Asset Management said in a commentary.

   "Regional banks have become the canaries in the credit coal mine, and their 
chirping sounds suspiciously weak," he said.

   U.S. companies broadly are under pressure to deliver stronger profits after 
the S&P 500 surged 35% from a low in April. To justify those gains, which 
critics say made their stock prices too expensive, companies will need to show 
they're making much more in profit and will continue to do so.

   In other dealings on Friday, benchmark crude oil lost 61 cents to $56.85 per 
barrel. Brent crude, the international standard, gave up 64 cents to $60.42 per 
barrel.

   The U.S. dollar fell to 149.70 Japanese yen from 150.44 yen. The euro rose 
to $1.1703 from $1.1688.