Asian markets slipped Thursday, after disappointing U.S. private employment and services sector data led investors to trim over extended bets and look for better points to buy again.
Materials and energy stocks led the decline in Asia, after from eight-month highs reached on Wednesday, following a 2.8 percent decline in the Reuters-Jefferies CRB index, a commodities benchmark.
The U.S. dollar was largely steady against the euro after rebounding sharply Wednesday, benefiting as investors cut bets on higher-yielding currencies and after a Reuters story said Asian monetary officials would stick with U.S. Treasuries even if the top U.S. sovereign debt rating was downgraded.
The dollar has had a big influence on crude prices, with oil gaining when the currency weakens and vice versa. After tumbling overnight, the euro stabilized to trade roughly steady at $1.4175. The Australian dollar , which has been a favorite among investors because of the country's trade ties with China, was largely unchanged on the day at US$0.8008, after the surging U.S. dollar overnight spooked dealers into taking profits on the Australian currency's recent gains. Crude oil futures edged higher to trade above $66 a barrel in the Asian session.
Japan's Nikkei 225 Average lost 0.8 percent as Nippon Yusen and other shippers fell after weak U.S. economic data tempered hopes for a global economic recovery, leading investors to cash out of some issues. Toshiba fell 2 percent as some investors who bought shares on Wednesday at a public stock offering sold to take profits, market players said.
South Korea's KOSPI fell 2.6 percent, their biggest daily percentage loss in five weeks, with
renewed economic worries sending key industrial issues lower and banks tumbling on capital raising news.
Australian shares fell 2.1 percent, led by miners, as global economic data and a sober assessment from Australia's top central banker caused concern that the path to economic recovery could be a long one.
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In markets still trading, Hong Kong and China markets dropped as disappointing U.S. private employment data and lower commodity prices provided investors with an opportunity to cash in some of their recent sharp gains. The Hang Seng Index was down 2.4 percent, led by a 4.4 percent drop in CNOOC. Bulk shippers, which have made huge strides in recent weeks on improving sea freight rates, pulled back even though the key freight index rose 4.5 percent overnight as Forward Freight Agreements collapsed. China Cosco dropped 8.4 percent. China Shipping Development also slid 8.4 percent.
China's Shanghai Composite Index fell 1.3 percent, retreating from Wednesday's 10-month closing high. Coal shares were weak, with China Shenhua Energy sinking 2.4 percent. Steel shares outperformed, with Baoshan Steel up 4.5 percent. One analyst said steel stocks may have been buoyed by the insistence of the industry's lead negotiator in iron ore supply talks for price cuts of at least 40 percent.
Singapore's Straits Times Index declined 1.2 percent lower. Shares of Keppel Corp, the world's biggest maker of offshore oil rigs, fell as much as 4.4 percent on news that a customer that had placed orders worth about S$1.7 billion (US$1.2 billion) was facing financial difficulties.