Asian markets continued their weak run Tuesday with financial stocks sinking after U.S. credit card firms and banks were downgraded, stoking fears their troubles could spread to the global sector.
U.S. stocks ended lower on Monday after brokerages downgraded banks and credit card companies on signs consumers are falling behind on debt payments.
The Nikkei 225 Average finished lower with exporters such as Honda Motor coming under pressure after downgrades of U.S. credit card firms fuelled recession fears. Investors dumped shares of companies issuing disappointing earnings results.
Olympus tumbled nearly 14 percent after cutting its outlook due to a stronger yen and falling camera prices.
South Korea's KOSPI bucked the negative trend and rose 0.4 percent to a two-week closing high, as exporters such as LG Electronics rose despite persistent worries about a U.S. economic recession, with trade thinned before the lunar New Year holiday. Financial markets are closed from Wednesday until Friday for the Lunar New Year holidays. The markets will resume trading on Feb. 11.