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Asia stocks dip on U.S. recovery concerns; Nikkei sheds 0.1%

Published 06/09/2011, 02:50 AM
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Investing.com – Asian stock markets declined on Thursday, as concerns over the U.S. economic outlook weighed on market sentiment, while shares in Tokyo Electric Power Company plunged to a record low.

During late Asian trade, Hong Kong's Hang Seng Index slumped 1.3%, South Korea's Kospi Composite fell 0.57%, while Japan’s Nikkei 225 Index shed 0.11%.

In its Beige Book published Wednesday, the Federal Reserve said that the pace of the U.S. economic recovery slowed in four of the 12 Fed regions. Fed Chairman Ben Bernanke added that growth was uneven and “frustratingly slow.”   

Meanwhile, revised data released earlier showed that Japan’s economy shrank at an annualized rate of 3.5% in the first quarter, as the March 11 earthquake and tsunami disrupted factory production.

Shares in Tokyo Electric Power Company tumbled 4% to a new record low after power outages at its crippled Fukushima Daiichi nuclear plant hampered efforts to stop radiation leaks.

Shares in Nintendo, which fell sharply in the previous session after its latest games console disappointed investors, extended losses to a new five-year low, dropping 4.3% after UBS downgraded the stock to ‘neutral’ from ‘buy’.

Shares in the technology sector were also lower, tracking losses from its U.S. counterparts on Wall Street. Semiconductor manufacturer Elpida Memory saw shares fall 1%, while Fuji Electronics slumped 2.1%.

In Hong Kong, shares in the financial sector were broadly lower amid concern China’s central bank will continue tightening monetary policy even as the global recovery falters.

Shares in China Construction Bank declined 2.3%, China’s largest lender Industrial and Commercial Bank of China saw shares tumble 2.55%, while Hong Kong-listed shares of Bank of China shed 1.5%.

Li & Fung, the world’s biggest supplier of toys to major U.S. retailers slumped 1.9%.

The outlook for European stock markets was modestly higher ahead of the European Central Bank’s interest rate announcement.

The EURO STOXX 50 futures pointed to a rise of 0.25%, France’s CAC 40 futures added 0.15%, the FTSE 100 futures gained 0.2%, while Germany's DAX futures edged 0.1% higher.

Later in the day, the U.S. was to publish official data on its trade balance as well as a weekly government report on initial jobless claims.

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