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Asia stocks drop; Nikkei falls 1.05% as strong yen weighs

Published 08/22/2011, 02:52 AM
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Investing.com – Asian stock markets were broadly lower on Monday, amid ongoing concerns over prospects for global economic growth, while the Nikkei fell to a five-month low as shares in Japanese exporters came under pressure from a strong yen.

During late Asian trade, Hong Kong's Hang Seng Index sank 1.6%, Australia’s ASX/200 Index fell 0.5%, while Japan’s Nikkei 225 Index retreated 1.05%.

The yen rose to an all-time high against the greenback on Friday, prompting Japanese Finance Minister Yoshihiko Noda to sharpen his verbal warning to markets, saying he will “watch markets even more closely than before to see whether there is any speculative activity.” 

Noda added that Japanese authorities “won't rule out any measures and will take decisive action when necessary”.

Shares in Japanese exporters were pressured amid concerns over export earning prospects.

Electronics giant Sony saw shares retreat 1%, industrial equipment maker Fanuc, which gets nearly 75% of its revenue outside of Japan tumbled 4.1%, while automakers Nissan, Toyota and Honda dropped 4.15%, 2.45% and 2.55% respectively.

Meanwhile, in Hong Kong, shares in property developer China Overseas Land & Investment plunged 6.45% after reporting lower-than-expected earnings results after markets closed on Friday.

The downbeat results weighed on other shares in the sector, with Sun Hung Kai Properties falling 1.1% and Sino-Ocean Land Holdings tumbling 4.5%.

Exporters were also lower, with Li & Fung, the world’s biggest supplier of toys to major U.S. retailers, shedding 1.1%, while shares in Esprit Holdings, the Hong Kong-based retailer that counts Europe as its largest market declined 0.9%.

The outlook for European stock markets was downbeat after German Chancellor Angela Merkel said in an interview over the weekend that the introduction of euro bonds was “not the answer” to solve the region’s debt crisis.

The EURO STOXX 50 futures pointed to a loss of 1.3%, France’s CAC 40 futures dropped 0.85%, the FTSE 100 futures fell 1.2%, while Germany's DAX futures indicated a loss of 1.4%.

Later in the day, the U.S. was to publish a report on mortgage delinquencies.

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