the u.n. security council says it will begin working immediately on new measures against north korea after pyongyang's claim it tested a hydrogen bomb. and an expert shares his insights into how fiscal discipline and immigration issues will shape the european economy in the year ahead. the first week of 2016 has brought extreme volatility to global stock markets. investors are dealing with concerns over the chinese economy. and with north korea's nuclear test. gene otani on our business desk has been following the developments. gene. >> thanks, james. shanghai stocks dropped sharply at the open on thursday. and for the second time this week, the fall was so steep that it forced trading to stop completely. that led to severe losses in markets across the asia-pacific region. the shanghai composite finished the day only 30 minutes after the open. it tumbled 7% during that time. closing at 3125. the selloffs were triggered by
concerns over the yuan, dropping to a nearly five-year low against the u.s. dollar. analysts say many market players are worried the weaker currency will cause capital to flow out of china. the hang seng index also had a rough day. it dipped more than 3% to close at its lowest level since july 2013. many investors sold shares listed on the mainland. and seoul's kospi fell to a four-month low. stocks here in tokyo also took a heavy hit. for details on how investors reacted to the developments in china, we go to our biz reporter, mayu. >> it's really causing a stir among investors now that trading in china was halted for the second time this week. when it comes to stock selloff, tokyo was no exception. the nikkei closed below 18,000 for the first time sin october 14th. the benchmark has tallen four days in a row and is already
down 6%. now, in tokyo's main board, energy and steel sectors had losses today. inpex tumbled more than 5%. now, the reason behind the stock rout is really complex. indicators in china show a slowdown in the world's second largest economy. oil prices are falling amid rising tensions in the middle east, and north korea came out of the blue. now, all things considered, investors have going risk averse. we saw a rout not only in stocks but also in currencies. we saw a plunge in the yuan. that also affected other currencies. we saw the australian hit its lowest level since mid-november because australia ischina's biggest trading partner. the yen. the dollar slid below 118 yen for the first time since late august. so bottom line, china took the center stage today in both equities and currencies sort of
in a bad way. i'm mayu yoshida. after the grim opening this week, it says new rules will help ease the panic. officials say they'll ban major shareholders from selling more than 1% of outstanding stocks within a period of three months. shareholders will also have to announce their plans to sell stocks. 15 trading days in advance. the previous six-month ban on all sales by major shareholders is due to expire on friday. that rule was enforced during last summer's stock market turmoil. a big factor behind today's plunge in shanghai stocks is believed to be the weakening of the yuan. for some insight, we asked a market expert what's happening with the chinese currency. >> it seems becoming hard to control the current level because of the offshore trading
has become more speculative. it is most costly. it will intervene the currency market. now it's becoming increasingly harder for china to maintain their currency value in the range like before. it could be the currency value go back to the level in june 2010 when china introduced more flexibility over their currency value. at that time value was 6.8. so i think the further decline for the currency will be limited. so it could be a short-term impact for the markets. >> equity strategist at dio securities. more on biz coming up, but for now, it's back to you, james.
>> gene, thanks for the updates. in other news, north korea's claim continues to echo across the region and the world. the u.n. security council strongly condemned the reclusive country and pledged to impose new sanctions. nhk world's reporter reports from new york. >> reporter: ambassadors of the member countries of the security council had a closed-door emergency meeting at the request of the u.s., japan and south korea. after the meeting, its current president read out a press statement. he said the council members unanimously condemned the country's nuclear test, calling it a clear violation of security council's resolutions and pledged additional sanctions. >> the members of the security council will begin to work immediately on such measures in a new security council resolution.
>> please raise their hands. >> reporter: the security council had already passed four resolutions imposing sanctions against the country. they demanded north korea abandon all nuclear weapons and its existing nuclear program. they also banned the country from purchasing or procuring materials and technology to develop weapons of mass destruction. nevertheless, leaders of the nation ignored international sanctions in their aggressive efforts to pursue nuclear weapons. the security council has been sharply divided in recent years over how to deal with wars in syria between russia and china who battle president bashar al ass assad. but this time even china, a longtime ally of north korea, came forward to criticize the recent test. japan is not a permanent member of the council.
the ambassador agrees that tougher measures are needed against north korea. >> translator: a series of sanctions have been imposed on north korea, but they don't seem effective enough to make the country change its course or its policies. so the sanctions need to be tougher. we are aiming for that. >> it's been almost a decade since the north conducted its first underground nuclear test. some diplomats here say this time the credibility of the security council iseing tested in dealing with t country. whether they can forcets leadership to abandon the nuclear program or not. go kamoshida, new york. >> go, thank you. south korea's defense minister says pyongyang is using the nuclear test to shore up national unity before its first party congress in more than three decades. he spoke at an emergency meeting of lawmakers.
he said it's unlikely the north detonated a hydrogen bomb judging by the scale and power of the blast. han said the test is aimed at escalating tensions to pressure south korea to change its policy toward pyongyang. in may, north korea's workers party will hold its first congress since 1980. north korea's closest all is also reacting. officials in beijing say china will work with the international community in dealing with pyongyang. our reporter is following the developments. >> hiroki, chinese oicials have strongly criticizedhe north for the latest nuclear test. what steps do you think they will take? >> the country's leaders are infuriated at pyongyang's latest moves. the nuclear test is top news around the country. the communist party affiliated newspaper global times described it as undesirable and unwise.
ahead of the last three nuclear tests, north korean officials wa their counterparts in beijing said they were about to detonate nuclear devices. but they didn't do that this time. experts say this may be an indication of pyongyang's growing frustration and displeasure with china. an expert i spoke with says chinese leaders face a big dilemma, and they are worried. >> very close to the chinese border. and properties and geography have been experiencing damage, for example. the situation on the korean peninsula itself is very tense. and it contains elements for escalation of the tension. and on the one hand, the continued military exercises by republic of korea as well as the
united states, different kinds of forces on the korean peninsula itself is destabilizing of the whole situation. on the other hand, i don't think there is any reason to justify any country on the korean peninsula to develop and test nuclear devices. >> a top chinese leader held talks with kim jong-un in october to try to improve ties. he says officials in beijing are frustrated that north korea still went ahead and carried out the test. >> then will china g along with the u.n. security council on adopting new sanctions against pyongyang? >> china not only said yes to security council sanctions in 2013, it went farther and imposed its own measures. they included a trade ban on materials for nuclear arms and financial sanctions. but china is north korea's
largest trading partner and pyongyang's economic lifeline hinges on beijing's support. experts say chinese leaders are afraid that putting too much pressure on the north could further destabilize the region. >> as a good friend of dprk, china cares more about peace and stability on the korean peninsula, and china will urge whoever party on the korean peninsula to use their rationality to achieve this ultimate goal of denuclearization. so these two things do not conflict with each other. that we need to move toward the situation where china, russia and the united states will stand firm on this particular issue and reach consensus of a view together with the republic of korea and japan, of course, so that we will make the position
known to everyone involved on the korean peninsula that no one will tolerate the threat of developing nuclear weapons. >> he says the six-party talks remains the most viable framework to achieve the goal of denuclearizing the korean peninsula. chinese leaders will carefully balance their approach of putting pressure on north korea in the capacity of a good friend of the country. that's it from beijing. >> thanks, hiroki. north korea's state-run media are playing up its claim they are also demanding a major policy change from the united states. thursday's front page of the korean workers party newspaper showed leader kim jong-un fining a final order for the test. it also carried a commentary titled "the policy of strategic patience has ended." it urged the u.s. to realize the consequences of its so-called
hostile policies toward the north. eu officials are set to lift restrictions on some food products from fukushima that have been in place following the 2011 nuclear accident. the eu requires mandatory radiation checks on food imports from fukushima and surrounding prefectures. but the european commission says it will ease that rule for goods if radiation levels have been within safe limits for a certain period of time. it says it will allow fukushima vegetables, beef and other meat products, all fruit except persimmon, buckwheat and tea. the change is likely to take effect on saturday. the japanese government will urge the eu to lift the rule for all remaining products. this week "newsline" is airing a five-part series on the economic outlook for major markets. today we focus on europe. nhk world's ay asked an expert
about the key issues facing the region's economy this year. >> reporter: hello, professor. nice to meet you. >> nice to meet you. >> reporter: he's an associate professor at the university of tokyo. he's also served as a senior economist at the international monetary fund where he focused on policies to address the european impact of the 2008 financial crisis. what is the key for the european economy this year? >> one of the main things is how to implement fiscal rules, and that's what we are now -- i would like to share what's going on in this year, 2016. an institution called european stability mechanism for europe. when some country issued debt larger than the gdp ratio, the
esm order instructs the country and creditors to quickly reduce the debt burden. essentially the investors would have to forgive the debt. if this kind of mechanism is clearly written in the european treaty, then investors would be clear about when their investments lose value. they have to put -- so given the government side have to somehow have more incentive to reduce the fiscal deficit. in this situation. the question now is how to institutionalize the mechanisms that people will use. >> reporter: last year boats filled with refugees began arriving from the middle east and africa. he says their presence will shift the balance of power in europe. >> the european people that
greece is important to the european union because greece is kind of the front line of this migration. this will strengthen border control and the european union can help. i mean, this is kind of good for greece because this can be part of the negotiation for the debt restructuring. they have to be a little bit more forgiving to the greece. >> how is what's happening in europe relevant to the rest of the world? >> i do believe -- europe, again, if the transactions, goods and services, peoples and financial transactions are so frequent and so daily life kind of things, and it would have to be the case country and self start to be united more, and that's kind of a european experiment. that's kind of european people struggling, but at the same time, i do see that kind of
future with asia will become like that. so we should be watching very carefully how the europeans deal with it. >> we'll focus on the association of southeast asian nations in our next installment of world economic outlook 2016. and if you missed any of our previous episodes, be sure to check out our website. here's a look at some of the other business stories we're following today. japan's food exports hit a record high between january and november last year due to the weaker yen and strong demand. government officials say shipments brought in $5.6 billion, up 22% in yen terms from the same period in 2014. the world bank has cut its annual forecast for global growth to 2.9% due to concerns over china and other emerging economies. the bank revised downward its projected growth rate for japan to 1.3%.
it said the recovery remains weak despite improvements in corporate performances and the labor market. that's it for business news. i'll leave you with the markets. as global concerns erupted over the news of north korea's nuclear test, here in japan, it caused worry for another reason. worry over the fate of loved ones abducted long ago. nhk world has more.
>> reporter: the families of abductees have been waiting patiently for word from north korea. but they were upset with the news. >> translator: it's been a long time since we started calling for the return of our family members. but still, north korea continues nuclear experiments. they break their promise over and over. they always lie to us. >> reporter: her daughter was on her way back home from school when she went missing in 1977. the last time she saw her mother, she was 13 years old. megumi was not an isolated case. the government says at least 17 japanese citizens were abducted by north korean agents in the '70s and '80s. after years of denial, then-leader kim jong-il finally admitted to kidnapping megumi and others in 2002.
since then, only five have been allowed to return to japan. others including megumi are still unaccounted for. according to north korean officials, they have either died or were never kidnapped to begin with. but japanese investigators do not believe them. the japanese government has long called for the north to reopen its investigation into the fate of the abductees. in 2014, pyongyang promised to conduct a full-scale investigation. tokyo, in return, partially lifted economic sanctions against the country. the north officials said the probe would take about a year. since that pledge, no progress has been made. families of the abductees say time is running out. they're worried their aging relatives may not live long enough to see a reunion.
they are now calling for tougher sanctions by t japanese government. >> translator: we have to make the north understand that they will be in serious trouble unless they return the abductees. we need to force them to make that decision. >> reporter: the nuclear test shows once again that north korea is an unpredictable and reclusive state. one that is becoming even more difficult to negotiate with. the families, though, have a simple request. they just want to see their loved ones again. kafumi terui, nhk world, tokyo. "newsline" comes to you live from tokyo. i'm james tengan. for you out there planning to be in tokyo this weekend, expect warmer than average temperatures. jonathan oh joins us with this hour's skrup date. will central japan ever see average or below average
readings this year? >> hello. i think we may see a little bit of a cool-off as we go into the beginning of next week. but for the next few days, we actually will see a slight warming trend. what's happening is that frontal boundary that brought us some rain to okinawa on wednesday is now pushing toward the east, and behind it we're seeing a little resurgence of warmer air coming in. not a huge warm-up expected, but we will still see temperatures moving up just a bit going through the weekend. by monday, another area of cold air that will help drop temperatures off so we should be back to what's normal for this time of year. as we move forward in time, not a huge big difference in terms of the forcing mechanism, what's happening over japan. we do have this northwesterly flow that's moving around this high-pressure system back toward the west, and that will produce even more snowfall for hokkaido as we go forward in time. so if you want to see some snowfall, we're finally seeing some of that along portions, and we will see that continue as we move forward in time.
now, for tokyo, cooler weather has to wait till around monday or so. overnight lows will be getting cooler into the lower and single digits. look at this, friday, partly cloudy, 11. 12 on saturday. 13 on sunday. and then on monday, that's when we'll see temperatures dropping back off as we see partly cloudy skies. the average high for this time of year is around 9.7 degrees. so the high-pressure system has a big influence in terms of bringing those cooler temperatures back in. i do want to point out that it's clearing the skies over beijing, but it is forcing that particulate matter down to the south into okinawa. we actually had the second highest level in terms of air pollution concerns. that's something we'll have to look out for through friday. sunny skies, chilly with a high of zero. minus 16 in ulan bator. china into southern and eastern portions looking mainly dry conditions, but we'll see clouds with a high of 11. for you, as we look at the forecast for india, i wanted to point this out because we are looking at dry weather but hazy conditions. this is pretty typical for this
time of year. but because high pressure is over india, especially for north and northeastern india where we're seeing very calm winds. we're dealing with haze problems. a yellow warning is in effect for north and northeast india as we go throughout friday. and i don't think we're going to see a big change coming because high pressure continues to dominate the weather pattern, meaning it's going to be calm going forward in time. as we look at the forecast for europe, i want to point out this low-pressure system over the balkans. this low-pressure system has been a bit active, picking up some moisture and clashing with that colder air. a waterspout was reported wednesday, and damage was reported in the area. it is continuing to move to the north and east. it's going to wrap around some of that colder air into southwestern portions of russia and also ukraine. so be. prosecuted for snowfall there with some active weather further toward the south into turkey. another low-pressure system is coming on shore from the west. and that's going to bring some windy conditions and wet conditions. and we may be dealing with flooding. also over into france, look out for the possibilityf seeing 70