Asian equities fell sharply on Monday, with the Shanghai Composite Index ending more than 5 percent lower, as concerns over the long-term health of the euro zone and weak U.S. earning forecasts dampened investor appetite for risk.
But China led the way, slumping 5 percent, spooked by concerns of further tightening measures by Beijing to curb fast-rising property prices.
The euro tumbled to a 4-year low as investors worried that harsh spending cuts mandated by a bailout plan may choke off a fragile recovery in the 16-country euro zone.
Japan's Nikkei average declined 2.2 percent to a 10-week closing low, as the euro's tumble
to a four-year trough chilled investor sentiment and fanned worries that the euro zone's fiscal woes could slow global economic growth.
Exporters were hit as the yen advanced, while trading houses were hurt by a fall in metals prices and China-linked shares such as Komatsu by a fall in Shanghai stocks.
The benchmark Nikkei lost 226.75 points to 10,235.76, its lowest close since early March, although it early fell nearly 3 percent to 10,158.30.
The broader Topix dropped 1.7 percent to 920.43.
But Mizuho Financial outperformed after the country's second-largest bank by assets forecast a near doubling of profit this year as the economy recovers. Its shares ended 0.6 percent higher but jumped more than 3 percent earlier.
Its better-than-expected profit forecast underscored the brightening outlook for Japan's banking industry thanks to a decline in bad loans and a modest recovery in the world's second-largest economy.
NTT jumped 3.4 percent to 3,855 yen after the country's biggest telecom firm said it would cancel all of its 251 million treasury shares, or about 16 percent of shares outstanding, over two years.
Astellas Pharma finished 0.3 percent lower. Japan's No.2 drugmaker said it would buy U.S. biotech OSI Pharma for $4 billion in cash.
The benchmark Nikkei slipped 180.53 points to 10,285.37, falling below its 200-day moving average at around 10,350.
The broader Topix fell 1.1 percent to 926.15.
Japan's core machinery orders rose 5.4 percent in March and manufacturers expect further gains in orders in the coming months, in a sign that capital spending may gather pace on the back of a continued economic recovery.
Industrial robot maker Fanuc opened in positive territory after the data came out but then fell back and ended the session 2.6 percent lower at 9,700 yen.
Exporters such as Canon lost 1.7 percent, Sony retreated 4.5 percent and Nintendo fell 3.6 percent.
JVC Kenwood Holdings sank 21 percent to 38 yen after company's announcement on Friday of plans to submit a resolution for a 1-for-10 reverse stock split at its upcoming shareholders meeting. Nomura has cut its rating to "Neutral" from "Buy" and trimmed the target price to 47 yen from 60 yen due to bigger than expected extraordinary loss for this financial year.
KOSPI Loses 2.6%
Seoul shares fell across the board, with ongoing concerns about the euro zone's fiscal woes spurring heavy foreign selling of large caps and financial stocks.
Samsung Electronics, the world's top maker of memory chips and flat screens, fell 3.2 percent to a two-month low, although analysts welcomed its record $16 billion investment plan announced during market hours.
The Korea Composite Stock Price Index shed 2.60 percent to close at 1,651.51 points.
The stock index has been on a mainly downward streak in the past three weeks, off 6 percent from its 22-month high touched on April 26.
Financial stocks also were among big decliners, on fears the European debt crisis could lead to additional write-offs in loans. Woori Finance Holdings dropped 8.3 percent.
Samsung Life Insurance, the country's top life insurer, slid 5.7 percent to below its IPO price of 110,000 won.
POSCO, the world's No. 4 steelmaker, fell to a 10-month low, down 4.7 percent. The steel giant was chosen on Friday to buy Daewoo International, an energy trader and developer in a $3 billion deal.
Daewoo Shipbuilding & Marine Engineering took a battering from a local media report that steelmaker POSCO would drop a long-anticipated plan to bid for the shipyard, although POSCO said no decision had been made yet. The shipbuilder lost 4.2 percent, just off a 3-month low.
Investors have been awaiting strong signs of economic recovery following above-forecast quarterly results, while caution remained on the unwinding of government-led stimulus packages.
South Korean President Lee Myung-bak on Monday gave his most optimistic comments on the economy since the global financial crisis began.
His comment comes after South Korea's top state-run think-tank on Sunday raised this year's economic growth forecast for the second time in six months and urged the central bank to start normalizing its low interest rate policy.
Australia Drops 3.1%
Australian stocks slumped 3.1 percent to close at an eight-month low, hit by worries about Europe's sovereign debt crisis crimping global growth, which hammered metals prices and the mining sector.
The benchmark S&P/ASX 200 index lost 143.9 points to close at 4,467.2 .
New Zealand's benchmark NZX 50 index fell 0.6 percent to 3,170.7.
Most of the major sectors fell, with mining giant BHP Billiton dropping 4.5 percent after Chairman Jac Nasser said it would review plans for a tax on super-profits before making any investment decisions. Rival Rio Tinto slumped 5.6 percent to A$64.15.
Gold miners were among the few stocks to rise, with Newcrest Mining and Lihir Gold both gaining as prices held near record highs.
Myer Holdings, Australia's largest department store chain, fell 2.25 percent to A$3.04 after the company reaffirmed its guidance despite predicting a challenging fourth quarter.
Shares in Leighton Holdings, Australia's top construction contractor fell 2.6 percent to A$33.75, after the company trimmed its full-year revenue forecast.
Shanghai Hits 1-Year Low
Hong Kong stocks ended lower by 2.1 percent, tracking losses in other Asian markets as investors fret about the fiscal health of the eurozone and U.S. earnings.
The benchmark Hang Seng index shed 430.23 points lower at 19,715.20, below the key 20,000 level.
China's key stock index tumbled 5.1 percent to its lowest close in a year, led by property stocks, as retail investors fled the market after a rout sparked largely by the government's stronger-than-expected steps to clamp down on property prices.
The Shanghai Composite Index closed at 2,559.9 points, its lowest close since May 4, 2009, and posted its biggest one-day percentage drop in more than eight months. The index has dropped nearly 20 percent in only three weeks.
Property stocks bore the blunt of the market's downtrend again on Monday, with Gemdale Corp falling 8.4 percent while sector heavyweight China Vanke dropped 5.3 percent.
In Southeast Asia, Singapore's STI tracked the region's losses, with the index retreating 2 percent to 2,833.7 points.
Malaysia's KLCI shed 0.4 percent at 1,334.3 points.
Malaysian Airline System rose 0.5 percent. The country's national carrier reports first quarter earnings after the bell.