Most Asian shares were beaten down Wednesday as mounting concerns about slowing global growth and shaky sovereign debt led investors to dump equities in favor of investments perceived to be safer, such as gold.
In Japan, the Nikkei 225 average dropped 207.45 points, or 2.1%, to 9,637.14
Hong Kong’s Hang Seng Index collapsed 428.14 points, or 1.9%, to 21,992.70
Shares of commodity and shipping-related companies, as well as other firms dependent on overseas demand, suffered big losses on fears the global economic outlook was deteriorating.
Port operator Cosco Pacific Ltd. plunged 7.6%, and merchandise trading firm Li & Fung Ltd. sank 5%.
Shares of China Cosco Holdings Co. tumbled 5.2% in Hong Kong, after UOB Kay Hian cut its price target, saying the shipping company is expected to post a loss in the first half of the year.
BHP Billiton Ltd. and Rio Tinto Ltd. slid 3.4% and 3.1%, respectively, in Sydney, while shipbuilders Hyundai Heavy Industries Co. and Daewoo Shipbuilding & Marine Engineering Co. sank 6.4% and 4.4%, respectively, in Seoul.
Many of the region’s steel makers were also hard-hit, with JFE Holdings Inc. dropping 3.3% in Tokyo, BlueScope Steel Ltd. stumbling 5.4% in Sydney, and Hyundai Steel Co. giving up 3.9% in Seoul.
The broad tumble in regional stocks came in the wake of a big selloff on Wall Street overnight, as the release of weak consumer spending data added to growth worries raised earlier in the week by a poor ISM reading. The tumble happened even as U.S. lawmakers passed a bill to reduce the deficit and increase the nation‘s debt ceiling in time to prevent default.
European debt worries also came back to the fore Tuesday, with Italian and Spanish five-year credit-default-swap spreads spiking to new record highs.
Such concerns helped the financial sector lose ground in Asia, with Sumitomo Mitsui Trust Holdings Inc. down 2.7% in Tokyo, Australia & New Zealand Banking Group Ltd. dropping 2.6% in Sydney, and HSBC Holdings PLC losing 1.2% in Hong Kong.
Standard Chartered PLC edged up 0.6% in Hong Kong, after the U.K.-based bank, which is strategically focused on emerging markets for growth, reported a 20% improvement in its first-half net profit.
In Tokyo, shares of Toyota Motor Corp. fell 1.3% but still outperformed the broad market after the auto maker raised its fiscal-year profit target after posting a more than 99% drop in the fiscal first quarter ended June 30.
Eisai Co.’s stock dropped 3.3% after it reported a 28% fall in net profit for the same quarter as sales of its medicine used to treat Alzheimer’s tumbled.
Gold miners were an exception to the regional selloff, as the metal’s futures climbed further in electronic trading after ending at a record level in New York on Tuesday
Eldorado Gold Corp. soared 8% in Sydney, with Zhaojin Mining Industry Co. adding 6.3% in Hong Kong, and Shandong Gold-Mining Co. rising 2.9% in Shanghai.
In other markets
Shanghai’s CSI 300 Index shaved off 1.51 points to 2,954.87
Korea’s Kospi Index let go of 55.01 points, or 2.6%, to 2,066.26
Taiwan’s Taiex Index fell 127.86 points, or 1.5%, to 8,456.86
Singapore’s Straits Times Index withered 46.75 points, or 1.5%, to 3,130.34
New Zealand’s NZX 50 Index chopped 27.18 points, or 0.8%, to 3,369.82
Australia’s S&P/ASX 200 Index weakened 100.80 points, or 2.3%, to 4,332.80
