Asian markets were stung by sagging banking and brokerage shares Tuesday as concerns about write-downs by U.S. financial companies and an overnight drop on Wall Street dampened investor sentiment.
The benchmark Nikkei 225 index lost 194.33 points or 1.46% to end at 13,159.45 while the Hang Seng index closed down 429. 21 points or 1.89% at 22,258.0.
On the economic front, the jobless rate in Japan climbed to 4.1% in June, an increase of 0.1% from May, according to data released by the Ministry of Internal Affairs and Communications. Unemployment hit its highest rate since it touched 4.3% in June 2006. The government also reported the jobs-to-applicants ratio declined to 0.91 in June from 0.92 in May, and is at the lowest level since February 2005.
The Ministry of Internal Affairs and Communications reported that average monthly household spending in the country declined 1.8% in June from the same period prior year, marking the fourth straight month of declines. Overall, household income fell 2.1%, with income by heads of households down 4.1%.
Meanwhile, Japan's overall retail sales increased 0.3% in June, climbing for the eleventh consecutive month, the Ministry of Economy, Trade and Industry said. In May, retail sales rose a revised 0.3% on year. On a monthly basis, retail sales were flat after a 0.1% decline in May.
Toyota Motor fell 2.7% after the automaker said that it reduced its domestic production in June by 0.9% on year. Among other carmakers, Honda Motor dropped 2.2% and Nissan Motor shed 3.2%.
In the banking space, Mizuho Financial fell 2.4%, Sumitomo Mitsui lost 1.4% and Mitsubishi UFJ Financial and Resona Holdings dropped 1.6% each. Nomura Holdings tumbled 2.9%.
Nippon Steel fell 2.8% after the company suspended operation of a blast furnace at its Yawata steel works in southern Japan following a fire. JFE Holdings declined 0.8% and Sumitomo Metal Industries gave away 2.0%.
However, trading houses, which reported strong April-June earnings, led the resources sector higher. Sumitomo Corp. jumped 3.5% after the company reported a 52% jump in net profit following recent rises in the prices of materials and natural resources such as steel, nonferrous metal and coal. Mitsubishi Corp. rose 2.2% and Mitsui & Co. edged up 0.2%. Oil & gas miner Inpex Holdings gained 2.1%.
Among exporters, consumer electronic giant Sony plummeted 3.2% and office equipment maker Canon plunged 3.0%. Matsushita Electric Industrial slipped 0.2%. Earlier the Nikkei newspaper reported that the world's largest consumer electronics maker plans to start selling organic electroluminescent or OEL television sets as early as 2011.
Tokyo Electric Power shed 0.9% after the electric utility company reported a huge net loss in the fiscal first quarter ended June.
The Chinese market closed lower, reversing Monday's gains. The benchmark Shanghai Composite Index closed down 52.70 points or 1.82% at 2,850.31. Financial and property stocks lost ground, as developer Gemdale plunged after regulators rejected its proposal to issue new shares. Airlines and oil refiners were pressured by higher oil prices.
Among property developers, Gemdale tumbled 5.0%, China Vanke shed 3.2% and China Merchants Property Development fell 2.0%. In the financial sector, Bank of Communications lost 2.8% and Industrial and Commercial Bank of China dropped 2.3%, while China Life Insurance plunged 3.0%. CITIC Securities plummeted 3.2% and Haitong Securities slumped 4.1%.
Elsewhere:
Australia's S&P/ASX 200 shed 1.5% to 4,847.40.
New Zealand's NZX 50 index gave up 0.7% to 3,235.50.
South Korea's Kospi lost 2% at 1,567.20.
Taiwan's Weighted Index slumped 3% to 7,014.47.
Singapore's Straits Times Index fell 0.8% to 2,850.31.
with files from other wire services
