Taipei - Taiwan's government and economists were in agreement Wednesday that the US financial chaos would negatively hit local financial institutions, stock and property markets but only in the short term.

The island's Central Bank decided to cut its bank reserve ratios starting Thursday to free up 200 billion Taiwan dollars (6.25 billion US dollars) in a bid to ease fund flows and boost the local markets.

Beijing - China's biggest stock market followed global losses with a 3-percent plunge on Wednesday, led by falls in banking and real-estate shares.

The key Shanghai Composite Index, which tracks shares traded in local and foreign currencies, lost 2.90 per cent to end the day at a 22-month low of 1,929.05 points.

The smaller Shenzhen Composite Index fell by 1.89 per cent to close at 559.95 points.

Tokyo - As more Japanese companies affiliated with collapsed US investment bank Lehman Brothers filed for bankruptcy on Wednesday, the Japanese government said the nation's markets would only suffer limited negative effects from the fallout.

Sunrise Finance and Lehman Brothers Commercial Mortgage filed for bankruptcy Wednesday with total liabilities of around 7 billion dollars, news reports said.

New Delhi - The collapse of major Wall Street firms is likely to result in a tightening of liquidity, adverse impact on the banking sector and a slowdown for information-technology firms that serve customers in financial sectors, analysts said Wednesday.

The Reserve Bank of India, which had net foreign reserves of 288.8 billion dollars in the week ending September 5, has already taken measures to support the rupee which rose by 60 paisa against the dollar on Wednesday.

The central bank also barred Lehman's India subsidiary from remitting money to its parent company.

Seoul - Shares rebounded Wednesday on the Seoul stock exchange in reaction to US government plans to bail out the troubled insurance giant American International Group Inc (AIG).

Berlin - The effects of the Wall Street financial crisis on Germany have been moderate so far, Chancellor Angela Merkel told the Bundestag parliament in Berlin Wednesday.

In a debate on the 2009 federal budget, she said credit to German business had been significantly expanded.

The government was closely watching the crisis and consulting German banking leaders and other governments.

"An open economy like Germany's won't remain completely unaffected by this," she said.