Asian Stocks Tumble as Credit Fears Resurface

HONG KONG—Asian stocks fell sharply on Tuesday after big declines in the shares of Fannie Mae and Freddie Mac due to funding concerns gave investors a painful reminder of the fragility of global credit markets. European shares were set to open steeply lower on worries about the health of the financial sector. Britain's FTSE 100 is expected to fall 2 percent, and Germany's DAX and France's CAC-40 are both seen down 1.8 percent, according to financial bookmakers. Oil rose $1 to $142.44 a barrel despite pronouncements from the Group of Eight leaders that the global economy could slow further because of high crude prices, highlighting stagflation fears. A Lehman Brothers research report said a pending accounting change could force the two largest U.S. mortgage funders — which both have the U.S. government's implicit backing — to... [read full story]