Asian markets closed in the red Monday, but were well off their session lows as investors took the opportunity to buy beaten down stocks. But Tokyo, Seoul and Sydney still closed at multi-month lows, after more mortgage-related writedowns in the U.S. dragged the Dow Jones Industrial Average below 12,000 at the finish for the time since March.
Japan's Nikkei 225 Averageclosed at a one-month low, losing 0.6 percent after falling as much as 2 percent during the session, while the broader Topix Index ended 0.7 percent lower, led down by financial plays such as Mitsubishi UFJ Financial Group.
Mitsubishi Estate and other property developers also took a beating as reports of lower condominium prices led to a selloff in the sector.
Shares of Nishimatsuya Chain, a children's wear and sundries store chain operator, sank 9.9 percent to become the biggest percentage loser on the Tokyo bourse's first section, after warning that its parent-only net profit fell by more than half in the first quarter to May 20.
Seoul shares finished at their lowest level in 12 weeks with financials and memory chip makers struggling on renewed worries about the credit crunch and corporate earnings after a drop in Wall Street shares on Friday. The KOSPI closed down 0.9 percent at 1,715.6 points.
Shares in Hankook Tire erased some of its gains to close 0.3 percent higher on market speculation that French tyre maker Michelin may be buying more shares in the firm after it raised its stake to 8.9 percent on June 18.
The Hang Seng Index followed the rest of the region lower, slipping 0.1 percent despite having ecked out small gains at one point. Investors were worried that China will top off last week's fuel price increases with an interest rate hike. Over the weekend, the Chinese Central bank governor Zhou Xiaochuan warned that monetary policy might need to be tightened to fight inflation in the wake of last week's hike in domestic fuel prices.
This led to a decline in Chinese stocks, with the Shanghai Composite Index tumbling 2.5 percent on Monday.
Shares in Aluminum Corp of China's H-shares(Chalco) plunged 8 percent after the company warned its first-half net profit would slide at least 50 percent on rising production costs and falling prices of alumina.
Australia's S&P/ASX 200 index recovered early losses to close down 4.6 points or 0.09 percent at 5,283.7. The index fell to its lowest level since March, led down by the major banks after fresh worries about the health of the financial sector in the United States saw shares tumble on Wall Street on Friday.
Shares in childcare operator ABC Learning Centres, which is currently facing a lawsuit by the country's competition regulator, plunged 9.6 percent on news it would lift day care fees by up to 11 percent.
Babcock & Brown fell 5.5 percent after the UK's Independent newspaper said New York-based private equity group Kohlberg Kravis Roberts was considering making a moveon the troubled Australian investment group.
Singapore's Straits Times Index followed the regional decline to fall 0.7 percent. But Chinese shipping firm JES International climbed as much as six percent to hit a two-week high after it won two shipbuilding contracts worth $247.5 million.
Malaysia's KLSE Composite Index gave up more than 1 percent Monday. Shares in the country's second-largest lender, Bumiptura-Commerce Holdings, slipped 0.6 percent after its CIMB unit took a 42 percent stake in Thailand's BankThai for $177 million. BankThai surged more than 40 percent in Bangkok.
Taiwan stocks fell 0.3 percent on Monday to their lowest level in more than four months, hurt by big exporters such as TSMC as a slide on Wall Street raised worries over slowing demand for technology products.