Asian stocks tumbled Wednesday, with Japan's Nikkei entering the bear market, as global sentiment remains low on concerns over economic growth, China, and low oil prices.
In Japan, the Nikkei 225 tumbled 632.18 points, or 3.7 %, to 16,416.19, off by 21.3% from its 52-week high of 20,868.03 set June 2015.
This officially puts the index in bear market territory.
The Hang Seng index in Hong Kong dumped 749.51 points, or 3.8%, to 18,886.30, a three-and-a-half year low, amid concerns over its currency's peg to the dollar.
In Hong Kong, bank and property shares were sharply lower. Bank of China's Hong Kong-listed shares dropped 2% and its Shanghai-listed ones also fell 2% Hong Kong-listed Shimao Property dropped 5.9%
Overnight, the International Monetary Fund cut its global growth forecast for 2016 to 3.4% from 3.6%. The organization cited slower growth in emerging markets, especially in China, falling commodity prices, and rising interest rates in the U.S. as potential risks to global growth.
The dollar-yen pair was lower by 0.94 percent at 116.51. Major Japanese export stocks, such as Toyota, Nissan, Honda and Sony closed down as much 8%. A stronger yen is usually considered negative for Japan's exporters as it dampens earnings when translated back into the home currency.
Sharp was down 4% after rising 2.4% Tuesday. A Japanese state-backed investment fund is reportedly considering investing 300 billion yen ($2.5 billion U.S.) in the electronics maker to assist its restructuring plan. Japan Times, citing sources, said Tuesday that Taiwan's Hon Hai Precision Industry, also known as Foxconn, had also presented plans to invest around 500 billion yen in Sharp.
Energy plays were mostly negative, with Woodside Petroleum closing down 2.8%, Santos declining 7.5%, Inpex sliding 6.2%, Japan Petroleum down 4.7% and S-Oil down 1.5%. Oil Search, which was up by as much as 0.4%, retraced gains to finish 1.6%lower.
Hong Kong-listed shares of CNOOC, Petrochina and Sinopec were down up to 6%.
Commodity players remained under pressure. Among the big resources producers Down Under, shares of Rio Tinto slumped 2.8% and BHP Billiton finished 3.5% lower.
BHP trimmed its full-year forecast for iron ore production by 10 million tonnes to 237 million tones, following a mining disaster at its Samarco joint venture in Brazil, where output is suspended.
CHINA
The CSI 300 Index lost 48.75 points, or 1.5%, to 3,174.38.
The Chinese economy grew by 6.9% in 2015, according to official data, down from 2014's 7.3%, and the slowest pace of economic expansion since 1990.
The People's Bank of China (PBOC) said late on Tuesday it would inject more than 600 billion yuan ($91.22 billion U.S.) into the financial system to help ease a liquidity squeeze expected before the Lunar New Year holiday in early February. Before market open, the PBOC set the yuan mid-point rate at 6.5578, maintaining stability following the previous session's fix of 6.5596.
Elsewhere, the China Securities Regulatory Body (CSRC) said it approved several initial public offerings (IPOs) under its revised rules, which took effect on Jan. 1, under which investors are no longer required to put up a capital subscription process, according to reports.
The resumption of IPOs has been a concern as they tend to sop up market liquidity.
Bucking the trend on the Shanghai index, state-owned China Communications Construction climbed 8.4% and China Power Construction added 2%
In other markets
In Singapore, the Straits Times Index slumbered 78.7 points, or 3%, to 2,559.77
The Kospi in Korea subtracted 44.19 points, or 2.3%, to 1,845.45
Taiwan’s Taiex index surrendered 155.76 points, or 2%, to 7,699.12
In New Zealand, the NZX 50 dropped 10.48 points, or 0.2%, to 6,113.72
The ASX 200 ditched 61.54 points, or 1.3%, to 4,841.53
