Major Asian markets retreated heading into the weekend on Friday as concerns over the global economic outlook persisted in the wake of overnight losses on Wall Street and lingering worries over European sovereign debt.
Japan’s Nikkei 225 average backslid 190.86 points, or 1.9%, to 9,737.48
Hong Kong’s Hang Seng index stumbled 42.70 points, or 0.2%, to end the week at 20,690.79
Japanese stocks took the biggest fall amid modest trading volumes as exporters lost more ground on worries the yen would continue to strengthen and on fears the ruling government might increase the consumption tax rate.
Talk of an increase in consumption tax was a "special negative" for sentiment, said some experts. Kyodo news service Friday reported, citing senior lawmakers in the ruling Democratic Party of Japan, that the government will fight an upcoming Upper House election with a pledge to double Japan's consumption tax to 10%.
Taiwanese shares fell after the island's central bank increased its policy interest rate in a surprise decision announced after the markets closed Thursday. Real-estate shares skidded, with Cathay Real Estate Development falling 2.1%, Farglory Land Development dropping 4.8% and Hung Poo Real Estate Development sliding 4.5%.
The surprise 0.125-percentage-point rate increase, coupled with curbs on mortgages for areas in and around the capital, is "a shot across the bow of Greater Taipei's hot property market," said Yuanta Securities strategist John Brebeck.
Japanese technology exporters suffered heavy losses as wider Greek credit default swaps and signs of weakening U.S. consumer spending heightened concerns over the yen's strength, which would hurt their profitability.
Canon lost 4.5%, Fanuc gave up 4.6%, Panasonic dropped 2.1% and Tokyo Electron sank 5.6%.
Banking majors fell less than the broad market following reports in the Nikkei and the Financial Times that the Basel Committee on Banking Supervision could soften plans for new capital mandates for banks, after intense lobbying by the industry. Mitsubishi UFJ Financial Group slipped 0.5% and Sumitomo Mitsui Financial Group dipped 0.7%.
Bridgestone rose 0.8% after it raised its group net profit outlook for the first half of the year ending June 30.
In Sydney, shares of mining majors reversed some gains from Thursday, which came amid hopes Prime Minister Julia Gillard would water down the controversial Resources Super Profits Tax. BHP Billiton dropped 2.1% and Rio Tinto shed 3%, while Murchison Metals lost 4%.
Seoul-traded shares came off their early lows as local pension funds bought into stocks.
Construction stocks fell amid expectations that the sector would figure in the government's list financially fragile companies. GS Engineering & Construction dropped 1.7% and Hyundai
Engineering & Construction slipped 0.2%.
In foreign-exchange markets, the euro was at $1.2302 U.S. from $1.2328 U.S. in late New York Thursday, and at 110.33 yen from 110.28 yen. The dollar was at 89.68 yen from 89.49 yen.
CHINA
Chinese shares fell, tracking weakness in the U.S. markets and as uncertainties over the global recovery clouded the outlook for Chinese exports
Shanghai’s CSI 300 Index let go of 21.21 points, or 0.8%, to 2,736.29
Harbin Pharmaceutical Group shed 4.2% and Cosco Shipping gave up 2.1%, while Jiangxi Copper lost 0.5%.
Elsewhere;
Singapore’s Straits Times Index bucked the trend and actually gained 4.03 points, or 0.1%, to
2,851.64
Korea’s Kospi index lost 10.03 points, or 0.6%, to 1,729.84
Taiwan’s Taiex Index sank 115.18 points, or 1.5%, to 7,474.71
New Zealand’s NZX index shed 15.36 points, or 0.5%, to 3,034.11
Australia’s S&P/ASX 200 took off 66.70 points, or 1.5%, to 4,413
