Investing.com - Asian stock markets were mostly lower on Tuesday, with shares in Japan falling sharply to hit a one-month low as the yen strengthened against the U.S. dollar, weighing on sentiment.
During late Asian trade, Hong Kong's Hang Seng Index dropped 0.5%, Australia’s ASX/200 Index ended 1.51% lower, while Japan’s Nikkei 225 Index returned from a holiday to close down 3.08%.
Asia was given a negative lead from the U.S., where the Dow and S&P 500 closed lower after Atlanta Federal Reserve President Dennis Lockhart voiced his support of further tapering to the one already announced in December.
In Tokyo, the Nikkei fell to the lowest level since December 18 after the U.S. dollar fell below the JPY103-level against the yen on Monday. A stronger yen decreases the value of overseas income at Japanese companies when repatriated, dampening the outlook for export earnings.
Automakers Toyota and Honda saw shares retreat 2.3% and 3.5% respectively, Sony declined 2.3%, while index heavyweights Fast Retailing and Fanuc lost 5.1% and 3%.
Japanese megabanks were also lower with shares of the nation’s largest lender Mitsubishi UFJ Financial Group slumping 2.8%, while Sumitomo Mitsui Financial Group and Nomura Holdings fell 2.4% and 3.4% respectively.
Elsewhere, in Australia, the ASX/200 Index declined to the lowest level since December 19 as weakness in the financial sector weighed on the benchmark index.
Commonwealth Banking Group retreated 1.6%, National Australia Bank fell 2%, while ANZ Banking Group and Westpac Banking Group declined 1.7% and 1.5%.
Meanwhile, in Hong Kong, the Hang Seng moved lower amid ongoing concerns that a flurry of new initial public offering listings will lead to a share glut and hurt liquidity.
Shares in the financial sector were mostly lower, with China Construction Bank down 0.6%, Industrial and Commercial Bank of China shedding 0.5%, while China Merchants Bank and China Citic Bank dropped 0.7% and 1% respectively.
Looking ahead, European stock market futures pointed to a lower open. The EURO STOXX 50 futures pointed to a loss of 0.8% at the open, France’s CAC 40 futures shed 0.8%, London’s FTSE 100 futures indicated a drop of 0.7%, while Germany's DAX futures pointed to a decline of 0.9%.
Across the Atlantic, U.S. equity markets pointed to a steady open. The Dow Jones Industrial Average futures pointed to a gain of 0.03%, S&P 500 futures inched up 0.08%, while the Nasdaq 100 futures indicated a rise of 0.03%.
Later in the day, the U.S. is to produce data on retail sales as well as reports on import prices and business inventories.