Investing.com - Asian stock markets were lower on Tuesday, reversing sharp gains made in the previous session after the initial optimism which greeted news that Spain had secured a bailout for its banks faded and investors began to focus on the details of the rescue package.
Growing concerns that the region’s debt crisis will spill over to Italy and uncertainty over the outcome of a Greek general election on June 17 further weighed on market sentiment.
During late Asian trade, Hong Kong's Hang Seng Index shed 0.65%, Australia’s ASX/200 Index eased up 0.2%, while Japan’s Nikkei 225 Index slumped 1%.
Asian equities rallied on Monday after Spain’s Finance Minister Luis de Guindos said the European Union agreed to grant Madrid a loan of up to EUR100 billion, which the government will use to recapitalize the country’s ailing banking sector.
But investors remained jittery as details of the Spanish bailout agreement remained unclear, with the exact amount Spain is to receive still be decided, after the results of independent banking audits are published later this month.
Spain is the fourth euro nation to seek a rescue, after Greece, Portugal and Ireland. A financial crisis has gripped Spain since 2008, when a real estate bust caused big losses for many banks.
Concerns about Spain’s banks have grown since Bankia, the country’s fourth-largest lender, said last month it needed EUR19 billion in state aid to shore itself up against bad loans.
Appetite for riskier assets was further weighed amid uncertainty over the outcome of a Greek general election on June 17, which could determine the course of the country’s future in the euro zone, as well as concerns over Italy’s fiscal health.
In Tokyo, the Nikkei gave back more than half of Monday’s 2% gain, as most of the exporters which rose in the previous session retraced those gains.
Automakers Mazda and Nissan saw shares slump 2.95% and 1.8% respectively, Sony declined 2.1%, while heavy equipment makers Fanuc and Komatsu shed 1.25% and 0.7% respectively.
Japanese financial names were under pressure as well, with Mitsubishi UFJ Financial Group retreating 1.15% and Nomura Holdings dropping 2.2%
Meanwhile, shares in Hong Kong declined, dragged down by a 1.1% drop in index heavyweight HSBC Holdings. HSBC, which is Europe’s largest bank, commands a 15% weighting on the Hong Kong benchmark.
Shares in oil drillers and miners were lower, amid lingering concerns over the health of the global economy.
Oil giants CNOOC and Sinopec saw shares slump 1.5% and 2.2% respectively, tracking a sharp decline in oil prices, while Jiangxi Copper Company and Zijin Mining Group saw shares shed 0.7% apiece.
On the upside, China Southern Airlines saw shares rally 6.65% after announcing plans to raise up to CNY2 billion through a private share placement to its state-owned corporate parent.
Elsewhere, shares in Australia outperformed most regional equities after being closed Monday for a public holiday. The index was boosted by strong gains in airliner Qantas Airways and steel-maker BlueScope Steel.
Shares of Qantas Airways surged 10.8% after an Australian Financial Review report that the airline is preparing efforts to defend against a possible hostile takeover.
BlueScope Steel rallied 9.6% after it said its debt reduction plan was on track.
Looking ahead, European stock markets looked set to open largely flat, amid ongoing concerns over Spain’s bank bailout and uncertainty over the outcome of this weekend’s Greek elections.
The EURO STOXX 50 futures pointed to a modest 0.1% gain, France’s CAC 40 futures added 0.1%, London’s FTSE 100 futures dipped 0.1%, while Germany's DAX futures pointed to a decline of 0.15% at the open.
Later in the day, the U.S. was to publish official data on import prices and on its federal budget balance.
Growing concerns that the region’s debt crisis will spill over to Italy and uncertainty over the outcome of a Greek general election on June 17 further weighed on market sentiment.
During late Asian trade, Hong Kong's Hang Seng Index shed 0.65%, Australia’s ASX/200 Index eased up 0.2%, while Japan’s Nikkei 225 Index slumped 1%.
Asian equities rallied on Monday after Spain’s Finance Minister Luis de Guindos said the European Union agreed to grant Madrid a loan of up to EUR100 billion, which the government will use to recapitalize the country’s ailing banking sector.
But investors remained jittery as details of the Spanish bailout agreement remained unclear, with the exact amount Spain is to receive still be decided, after the results of independent banking audits are published later this month.
Spain is the fourth euro nation to seek a rescue, after Greece, Portugal and Ireland. A financial crisis has gripped Spain since 2008, when a real estate bust caused big losses for many banks.
Concerns about Spain’s banks have grown since Bankia, the country’s fourth-largest lender, said last month it needed EUR19 billion in state aid to shore itself up against bad loans.
Appetite for riskier assets was further weighed amid uncertainty over the outcome of a Greek general election on June 17, which could determine the course of the country’s future in the euro zone, as well as concerns over Italy’s fiscal health.
In Tokyo, the Nikkei gave back more than half of Monday’s 2% gain, as most of the exporters which rose in the previous session retraced those gains.
Automakers Mazda and Nissan saw shares slump 2.95% and 1.8% respectively, Sony declined 2.1%, while heavy equipment makers Fanuc and Komatsu shed 1.25% and 0.7% respectively.
Japanese financial names were under pressure as well, with Mitsubishi UFJ Financial Group retreating 1.15% and Nomura Holdings dropping 2.2%
Meanwhile, shares in Hong Kong declined, dragged down by a 1.1% drop in index heavyweight HSBC Holdings. HSBC, which is Europe’s largest bank, commands a 15% weighting on the Hong Kong benchmark.
Shares in oil drillers and miners were lower, amid lingering concerns over the health of the global economy.
Oil giants CNOOC and Sinopec saw shares slump 1.5% and 2.2% respectively, tracking a sharp decline in oil prices, while Jiangxi Copper Company and Zijin Mining Group saw shares shed 0.7% apiece.
On the upside, China Southern Airlines saw shares rally 6.65% after announcing plans to raise up to CNY2 billion through a private share placement to its state-owned corporate parent.
Elsewhere, shares in Australia outperformed most regional equities after being closed Monday for a public holiday. The index was boosted by strong gains in airliner Qantas Airways and steel-maker BlueScope Steel.
Shares of Qantas Airways surged 10.8% after an Australian Financial Review report that the airline is preparing efforts to defend against a possible hostile takeover.
BlueScope Steel rallied 9.6% after it said its debt reduction plan was on track.
Looking ahead, European stock markets looked set to open largely flat, amid ongoing concerns over Spain’s bank bailout and uncertainty over the outcome of this weekend’s Greek elections.
The EURO STOXX 50 futures pointed to a modest 0.1% gain, France’s CAC 40 futures added 0.1%, London’s FTSE 100 futures dipped 0.1%, while Germany's DAX futures pointed to a decline of 0.15% at the open.
Later in the day, the U.S. was to publish official data on import prices and on its federal budget balance.