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World

Asia stocks fall amid Europe debt turmoil grows

Associated Press
Published | Updated

BANGKOK – Unsettling news about Europe's debt crisis and disappointing U.S. corporate earnings weighed on Asian stock markets Tuesday.

Japan's Nikkei 225 index fell 0.4 percent to 9,506.82 and South Korea's Kospi dropped 0.2 percent to 1,969.66. Still, the losses were muted compared to Europe, where political turmoil and disappointing economic data led to steep drops in stocks on Monday.

Hong Kong's Hang Seng was nearly unchanged at 20,617.77 after a higher opening. Key benchmarks in mainland China and Taiwan also fell. Those in Singapore and Indonesia rose.

Australia's S&P/ASX 200 added 0.3 percent to 4,363.20, with lower-than-expected inflation encouraging traders to wade into stocks. The country's central bank has said it would likely cut interest rates so long as inflation was not a threat. Traders generally view such a step as good for companies.

But strong headwinds continued to emanate from Europe, where a festering, two-year debt crisis has begun jolting the region's political landscape.

The Dutch government collapsed Monday, and a new report showed that European government debt is piling up despite severe budget cuts. Separately, a survey of the eurozone's manufacturing and services sectors unexpectedly fell in April to a five-month low of 47.4, down from 49.1 in March. A level below 50 means contraction.

"Markets are watching closely and don't like what they see. Things are plainly moving in the wrong direction once again," DBS Bank Ltd. in Singapore said in a research note.

U.S. stocks also suffered from disappointing corporate news. Toy giant Hasbro fell 5.2 percent after posting a first-quarter loss on falling sales and costs tied to cutting jobs. Netflix, the Internet video subscription service, posted its first quarterly loss in seven years.

The Dow Jones industrial average fell 0.8 percent to close at 12,927.17. The Standard & Poor's 500 index fell 0.8 percent to 1,366.94. The Nasdaq composite index fell 1 percent to 2,970.45.

Benchmark oil for June delivery was up 10 cents to $103.21 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 77 cents to settle at $103.11 in New York on Monday.

In currencies, the euro rose to $1.3150 from $1.3144 late Monday in New York. The dollar fell to 80.97 yen from 81.13 yen.