Asian stocks fell on Wednesday as geopolitical concerns over Iraq overshadowed better-than-expected U.S. data.
U.S. Secretary of State John Kerry urged Kurdish leaders on Tuesday to ally with the government to stop the advance of the Islamic State of Iraq and the Levant (ISIL). Security forces fought the militants on Tuesday for control of the country's biggest oil refinery after the rebels launched an attack on one of Iraq's largest air bases, located less than 100 kilometers from Baghdad.
A negative handover from Wall Street underpinned losses in Asia. The Dow Jones Industrial Average posting its biggest drop in a month despite a raft of positive data. Consumer confidence surged more than expected in June, new home sales for May rose more than forecast, and the S&P/Case-Shiller home price index for April showed a 10.8 percent annual increase.
Nikkei 0.7% lower
Japanese shares fell to a one-week low as investors booked profits on the five-month highs this week. Prime Minister Shinzo Abe's latest reform plan, announced after the market close on Tuesday, was met with a muted market reaction and a note of caution.
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"We were provided with some hints about future growth and the reform path but we're still somewhat light regarding any sort of implementation timeline. So, I think we will just have to wait and see on this," said Matthew Hegarty, equities analyst at Perennial International.
China shares lower
The mainland's benchmark Shanghai Composite index eased 0.4 percent as investors shrugged off news that Beijing will ease rules for some foreigners investing in businesses outside the banking sector.
Real-estate developers were in focus after a Reuters study of more than 80 developers showed cash to short-term-debt ratios were at two-year lows amid a steady decline in margins since 2011. Poly Real Estate fell 1.4 percent while China Merchants Property shed 2 percent.
Hong Kong's benchmark Hang Seng Index pared earlier losses to trade flat.
ASX down 0.6%
Australia's benchmark index fell for for a third straight day, ending at its lowest level this week, due to weakness in miners.
Shopping mall company Scentre, the spin off unit of property group Westfield, debuted on the stock market at $A.321.
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Kospi slips 0.6%
South Korean shares fell after rallying over 1 percent on Tuesday, weighed down by a near 2 percent fall in Samsung Electronics.
Sensex 0.1% lower
Indian shares traded just below the flat line on caution ahead of the June derivatives on Thursday.