Most Asian stocks and currencies suffered heavy losses Thursday on deepening worries about European sovereign debt and fears that Beijing's tightening policies might slow Chinese economic growth.
Tokyo’s Nikkei 225 returned from a three-day holiday with a 3.3% loss -- or 361.71 points -- to 10,695.69.
In Hong Kong, the Hang Seng index plunged 194.13 points, or 1%, to 20,133.41
Investors were also spooked by a warning by Moody's Investors Service on Wednesday that it could cut Portugal's Aa2 sovereign rating by up to two notches.
Resource stocks tumbled across the region as the U.S. dollar's strength hurt commodity prices. BHP Billiton dropped 2.9% and Rio Tinto lost 3.8% in Sydney, commodities trader Mitsubishi Corp. slumped 5.4% and Japan Petroleum Exploration Co. dropped 4% in Tokyo, and Cnooc gave up 2.4% in Hong Kong.
In Tokyo, the euro's weakness against the yen on Wednesday hurt exporters with a high exposure to Europe. Canon dropped 3.1%, Mazda shed 5% and Nikon lost 3.5%.
A sharp fall in commodity linked shares added to the selling pressure on the mainland bourses, where banking and property stocks continued to suffer on persistent worries about more possible monetary tightening measures from the government.
Shares of Yanzhou Coal Mining Co. and Yunnan Tin Co. dropped by the day's 10% limit, with Poly Real Estate Group Co. losing 6.7% and China Merchants Bank falling 4.6%.
Financial stocks took a hit in South Korea and Australia amid risk-aversion. In Seoul, KB Financial lost 5.2% and Woori Finance shed 5.8% amid increased global uncertainty.
In Australia, Westpac dropped 4.2% despite reporting first half net profit rose 32% from a year earlier, as the stock met a slew of analyst downgrades, with RBS saying the bank is "running on one cylinder."
"The only source of net profit growth was the fall in the bad debt charge. With the easy gains on bad debts over and doubts about revenue growth, WBC's premium is no longer warranted," RBS said.
National Australia Bank sank 3.4% after it recorded a 22% fall in its first-half net profit on higher losses on the market value of derivatives, while cash earnings were boosted by a fall in bad debt charges and improved profit in its business banking and wealth management arms.
Bucking declines in Seoul, Daewoo Motor Sales surged 14.8% as Min Euoo-sung, chairman of main creditor Korea Development Bank, said Wednesday it would make an all-out effort to put the vehicle sales and real estate development company back on track.
Fujitsu shed 0.9% in the weak Tokyo market, but outperformed the market when the company said Friday after the market closed that it swung to a net profit in its fiscal fourth quarter, thanks to restructuring of its chip business and the sale of unprofitable hard-disk drive operations.
It also said it expects operating profit for its current fiscal year to come in around 185 billion yen ($1.99 billion U.S.), stronger than consensus forecasts.
In Sydney, Centennial Coal jumped 18.1% to 4.71 Australian dollars ($4.29 U.S.) after four large trades in the stock, representing 10.6% of company's shares on issue, changed hands at A$5.00 a share.
In the foreign-exchange markets, the euro slid to $1.2801 U.S. from $1.2816 U.S. late Wednesday in New York and to 119.79 yen from 120.12 yen. The U.S. dollar bought 93.59 yen, compared with 93.66 yen.
Elsewhere;
Shanghai’s CSI 300 dropped 139.54 points, or 4.6%, to 2,896.86
Singapore’s Straits Times Index moved lower 20.66 points, or 0.7%, to 2,839.65
Korea’s Kospi index returned from holiday to post a loss of 34.04 points, or 2%, to close at
1,684.71
Taiwan’s Taiex index fell 117.42 points, or 1.5%, to 7,579.48
New Zealand’s NZX 50 Index declined 30.89 points, or 1%, to 3,217.92
Australia’s S&P/ASX 200 slid 100.80 points, or 2.2%, to 4,573.20
