Recession fears haunt markets

By Martin Howell and Andrew Roche

NEW YORK/LONDON (Reuters) - Fears of a deep global recession dominated investor sentiment as financial markets in the Asia-Pacific region began to reopen on Monday after last week's worldwide slide in stock prices and currency collapses.

There were early indications that governments and central banks will take further dramatic action to prop up the global financial system this week.

The Japanese Finance Minister called a news conference for 9:00 a.m. (8:00 p.m. EDT), and the Bank of Korea announced an emergency meeting for Monday morning amid forecasts from analysts that it will announce an interest rate cut.

But there is growing concern that intervention by authorities will not be enough to prevent companies from slashing production and jobs as sales get hit and financing remains difficult.

Initially, financial markets were relatively stable in Asian trade on Monday.

Standard & Poor's 500 December index futures opened the week slightly higher, gaining 3.0 points at 869.80 after about an hour, though the Australian dollar traded close to record lows against the yen and near 5-1/2 year lows against the U.S. dollar. However, Japan's stock market is expected to decline, threatening to take the Nikkei average to a 26-year low.

The International Monetary Fund on Sunday reached an agreement in principle with Ukraine for a $16.5 billion loan package to ease the effects of the financial crisis.

The IMF also said that it will announce a "substantial financing package" for Hungary in the next few days that will include financing by the European Union and some individual European governments.