Asia shares bruised by stagflation worry

Shares in Asia took another beating on Tuesday, with financial stocks and exporters hardest hit on concerns that a slowing economy in the United States combined with accelerating price rises could lead to stagflation. Investors shunned riskier stocks and sought comfort in government bonds, worried that stagflation, which refers to when prices rise and growth stagnates, would curb spending and drag out the credit crisis. Stagflation was last seen in the 1970s following a massive spike in oil prices.Oil prices edged up towards US$91 (S$133) a barrel on Tuesday, while Japanese government bonds firmed, tracking gains in Treasuries. News that sentiment among US home builders held at a record low for a third consecutive month in December intensified worries about the US housing market slump - the trigger for the credit crisis... AsiaOne