May 31 - Asian stocks markets set to post their biggest monthly loss in eight months, as Spain's surging borrowing costs heighten fears it may need a bailout.
Asian stocks and commodities tumbled as surging borrowing costs heightened fears Spain would not be able to rescue its banks and may need a bailout. Shares outside Japan tumbled as much as 1.6 percent, leaving it a whisker above a 2012 low hit only last week. The MSCI All Asia Ex Japan index is on course to close the month down nearly 12 percent, the biggest in eight months. The losses mean some key Asian bourses, Hong Kong, Australia, South Korea and Japan have, or are close to, wiping out any gains made for the year to date. Japan's Nikkei lost as much as 1.8 percent, and the Hang Seng fell to four-and-a-half-month lows. Tumbling markets claimed a fourth IPO victim this week in Asia, with luxury jeweller Graff Diamonds suspending its planned Hong Kong listing. But JP Morgan's Geoff Lewis thinks listings will resume once conditions improve later in the year. (SOUNDBITE) (English) GEOFF LEWIS, HEAD OF INVESTMENT SERVICES OF JP MORGAN ASSET MANAGEMENT, SAYING: "Well I think we are definitely going through a rough patch that is still more to global worries, global fears, risk-off trade again, and concerns coming from Europe. I think the Asian IPO market was healthy enough earlier in the year, so I wouldn't be surprised if we see a few months now where it is rather difficult for firms to come to the market with IPOs. But I would imagine better conditions will return later in the year. I don't think this is a major turning point. I see it more as a temporary interruption which has more to do with the events outside Asia than within Asia." The dollar and the yen were major beneficiaries of escalating risk aversion as the cost of insuring against a Spanish default scaled a record high. Concerns over Italy huge public debt also stoked fears, sending the euro down close to 2-year lows against the dollar. Arnold Gay, Reuters