Asian markets and commodities retreated Tuesday while the yen pushed higher as a gloomy economic outlook took some of the wind out of investor hopes sparked by China's stimulus plan.
Monday's excitement over a massive Chinese economic stimulus package gave way to gloom after Deutsche Bank lowered its view on the equity value of General Motors to zero, sending its shares to 62-year lows, and analysts warned that Goldman Sachs could post a quarterly loss for the first time in its history.
The dollar dipped against the yen, while the euro was also down against yen. Oil prices extended losses to trade at the $60 a barrel level.
Japan's Nikkei 225 Average finished 3 percent lower, with exporters such as Canon diving on fears about the global economy, while automakers skidded after GM shares plunged to 62-year lows on its grim outlook. The broader Topix also declined 3 percent.
Seoul shares ended down 2 percent as tech companies slid after a bankruptcy filing by a major U.S. electronics retailer and banks fell on growing concerns over funding distress and rising bad
debt. LG Electronics dropped 7 percent and KB Financial Group shed 2.68 percent.
Australian stocks closed down 3.6 percent on renewed worries about the global economy, with banks falling on concerns they may need to raise cash and miners down on the prospect of slowing demand and production cuts.
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Hong Kong shares closed 4.8 percent lower, weighed down by HSBC on worries the global economic downturn will increase bad loans. HSBC lost 4.7 percent after it said on Monday that it took a $4.3 billion hit for bad debts in the United States, up $700 million from the previous quarter.
Singapore's Straits Times Index fell 4.1 percent, hurt by global recession fears and led by losses in lender DBS Group and Singapore Telecommunications. Top lender DBS fell almost 5.8 percent, while SingTel dropped 6.4 percent after JPMorgan cut its price target for the shares on expectations of lower profit.
China's Shanghai Composite Index closed 1.7 percent lower, with the market weaving in and out of negative territory.