Investing.com - Asian stock markets were broadly lower on Thursday, after a weak Spanish bond sale renewed concerns over the euro zone’s debt crisis, further undermining sentiment hurt by diminishing expectations for more stimulus in the U.S.
During late Asian trade, Hong Kong's Hang Seng Index slumped 0.7%, Australia’s ASX/200 Index edged down 0.35%, while Japan’s Nikkei 225 Index fell 0.6%.
Appetite for riskier assets took a hit Wednesday after a Spain’s Treasury auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion, in the country’s first debt auction since last week’s austerity budget.
There have been renewed concerns of further debt contagion in the euro zone in recent weeks amid fears over the fiscal health of the region’s fourth largest economy. On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Market sentiment was already on the defensive after minutes from the March meeting of the Federal Reserve's Open Market Committee released Tuesday indicated that the central bank was unlikely to introduce more stimulus measures to help boost the U.S. economy in the near term.
The news prompted investors to shun riskier assets, such as stocks and commodities and flock to traditional safe haven assets.
In Japan, the Nikkei extended heavy losses from the previous session, moving further below the key psychological level of 10,000 to close at a four-week low, raising fears that the benchmark’s strong rally in the first quarter was coming to and end.
Shares in the financial sector were broadly lower, with Mitsubishi UFJ Financial Group dropping 1.2% and Sumitomo Mitsui Financial Group retreating 1.4%.
Exporters came under pressure from a stronger yen, with automakers Honda and Nissan slumping 1.15% and 1.05% respectively, while shares in Nikon dropped 1.85%, further weighed by a downgrade to hold from buy at BNP Paribas.
Elsewhere, shares in Hong Kong dropped as the Hang Seng reopened after a public holiday on Wednesday, with shares in lenders leading losses after Chinese Premier Wen Jiabao said Tuesday that it was too easy for China’s state-run banks to make profits, and that the government needs to break their “monopoly.”
China Construction Bank shares fell 1.45%, Bank of China slumped 1%, while shares in China’s largest lender by market value Industrial and Commercial Bank of China declined 1.6%.
Also contributing to losses, Zijin Mining Group lost 2.55% after gold and copper prices plunged on Wednesday.
In Australia, shares fell to a one-week low as investors shunned stocks in retailers. Electronics retailer JB Hi-Fi dropped 1.95% to settle at a three-year low, while Harvey Norman shares tumbled 4.9%.
Raw material producers were also lower, with mining giants BHP Billiton and Rio Tinto down 1% and 1.9% respectively, while gold miner Newcrest Mining shed 1.45%.
Looking ahead, European stock markets were set to rebound from the previous day’s steep losses.
The EURO STOXX 50 futures pointed to a gain of 0.45%, France’s CAC 40 futures added 0.6%, London’s FTSE 100 futures edged up 0.45%, while Germany's DAX futures pointed to a gain of 0.5% at the open.
Later in the day, Germany was to publish official data on industrial production, while the U.S. was to publish government data on unemployment claims.
During late Asian trade, Hong Kong's Hang Seng Index slumped 0.7%, Australia’s ASX/200 Index edged down 0.35%, while Japan’s Nikkei 225 Index fell 0.6%.
Appetite for riskier assets took a hit Wednesday after a Spain’s Treasury auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion, in the country’s first debt auction since last week’s austerity budget.
There have been renewed concerns of further debt contagion in the euro zone in recent weeks amid fears over the fiscal health of the region’s fourth largest economy. On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Market sentiment was already on the defensive after minutes from the March meeting of the Federal Reserve's Open Market Committee released Tuesday indicated that the central bank was unlikely to introduce more stimulus measures to help boost the U.S. economy in the near term.
The news prompted investors to shun riskier assets, such as stocks and commodities and flock to traditional safe haven assets.
In Japan, the Nikkei extended heavy losses from the previous session, moving further below the key psychological level of 10,000 to close at a four-week low, raising fears that the benchmark’s strong rally in the first quarter was coming to and end.
Shares in the financial sector were broadly lower, with Mitsubishi UFJ Financial Group dropping 1.2% and Sumitomo Mitsui Financial Group retreating 1.4%.
Exporters came under pressure from a stronger yen, with automakers Honda and Nissan slumping 1.15% and 1.05% respectively, while shares in Nikon dropped 1.85%, further weighed by a downgrade to hold from buy at BNP Paribas.
Elsewhere, shares in Hong Kong dropped as the Hang Seng reopened after a public holiday on Wednesday, with shares in lenders leading losses after Chinese Premier Wen Jiabao said Tuesday that it was too easy for China’s state-run banks to make profits, and that the government needs to break their “monopoly.”
China Construction Bank shares fell 1.45%, Bank of China slumped 1%, while shares in China’s largest lender by market value Industrial and Commercial Bank of China declined 1.6%.
Also contributing to losses, Zijin Mining Group lost 2.55% after gold and copper prices plunged on Wednesday.
In Australia, shares fell to a one-week low as investors shunned stocks in retailers. Electronics retailer JB Hi-Fi dropped 1.95% to settle at a three-year low, while Harvey Norman shares tumbled 4.9%.
Raw material producers were also lower, with mining giants BHP Billiton and Rio Tinto down 1% and 1.9% respectively, while gold miner Newcrest Mining shed 1.45%.
Looking ahead, European stock markets were set to rebound from the previous day’s steep losses.
The EURO STOXX 50 futures pointed to a gain of 0.45%, France’s CAC 40 futures added 0.6%, London’s FTSE 100 futures edged up 0.45%, while Germany's DAX futures pointed to a gain of 0.5% at the open.
Later in the day, Germany was to publish official data on industrial production, while the U.S. was to publish government data on unemployment claims.