Asian shares fell Monday as markets awaited details of plans to fix Europe's debt crisis and the outcome of key Sino-U.S. trade talks, with simmering tensions between the economic superpowers.
Japan’s Nikkei 225 Index faded 26.64 points, or 0.3%, to 8,348.27
In Hong Kong, the Hang Seng Index dumped another 265.38 points, or 1.4%, to 18,225.80
Markets also reacted to news that Japan logged an unexpected trade deficit in October, while business hub Singapore predicted sharply lower economic growth next year and warned a weaker global economy could worsen the situation.
Japan on Monday posted a 273.8-billion-yen ($3.6-billion U.S.) trade deficit in October, reversing a year-earlier surplus of 812.6 billion yen and confounding economists' expectations.
Markets were also watching deliberations on a U.S. deficit-reduction plan ahead of Wednesday's deadline.
Investors also awaited details of China-U.S. trade talks which started Sunday, with Beijing's currency policy -- and claims it undervalues the yuan -- and market access restrictions expected to top the agenda.
The two countries signed agreements covering areas that include energy cooperation and the trade of high-technology products, but offered no details, according to sources.
In Sydney, Qantas fell 1.2% after announcing that it had been unable to reach a compromise deal over pay and conditions with pilots and ground crew unions, and would now go to arbitration.
Elsewhere, the European Commission will publish legislative proposals for common euro-zone bonds on Wednesday in the latest bid to contain the debt crisis, which has threatened to plunge the world economy into recession.
New rules would see troubled euro-zone states effectively club together to guarantee each other's debts and police national budgets to keep the region's fiscal woes in check.
The proposals have been designed to combat nearly two years of regional turmoil after bailouts for Greece, Ireland and Portugal, and with even France now facing mounting pressure going into a presidential election year.
Governments have been deposed by economic turmoil in several nations, with Spain's conservative Popular Party sweeping to victory Sunday in a general election with rising concerns about the country's ability to finance its debts.
International Monetary Fund chief Christine Lagarde warned Sunday that Europe's economic problems, if not addressed, could spread, leading to "major" consequences for the United States, a key trade and business partner which is already fighting to pull itself out of the economic doldrums.
On currency markets, the euro fetched $1.3445 U.S. and 103.31 yen, compared with $1.3519 U.S. and 104.00 yen in New York late Friday.
The dollar was at 76.85 yen, compared with 76.93 yen in New York and a post-war low of 75.32 yen at the end of last month.
In other markets;
Shanghai’s CSI 300 index eked up 3.19 points, or 0.1%, to 2,609.69
Taiwan’s Taiex Index deducted 191.14 points, or 2.6%, to 7,042.64
Korea’s Kospi Index slid 19.14 points, or 1%, to 1,820.03
Singapore’s Straits Times Index dipped 32.36 points, or 1.2%, to 2,697.98
New Zealand’s NZX 50 Index gained 5.66 points, or 0.2%, to 3,256.56
Australia’s S&P/ASX 200 Index let go of 14 points, or 0.3%, to 4,163
