Asian shares dragged down by Wall Street slump

BANGKOK – A slump on Wall Street sparked by tumbling demand for oil and fears of slackening growth in the U.S. pulled Asian shares down Thursday.

Japan's Nikkei 225 index dropped 0.8 percent to 9,786.52, while South Korea's Kospi slid 1.2 percent to 2,141.09. Hong Kong's Hang Seng lost 0.9 percent at 23,073.39 and Australia's S&P ASX 200 was 1.4 percent down to 4,713.90. Benchmarks in Singapore, Taiwan and New Zealand were also lower.

A strengthening yen hurt Japanese exporters — but notably not Toyota Motor Corp., the world's largest automaker, which jumped 3 percent a day after the company said its efforts to fix production following a devastating March 11 earthquake and tsunami were going better than expected.

Energy shares suffered declines after crude oil fell 4 percent to below $100 a barrel. Inpex Corp., Japan's largest energy explorer, drooped 2.7 percent. PetroChina Co. Ltd., the publicly traded unit of China's biggest oil and gas company, lost 2.2 percent. BHP Billiton Ltd., the world's biggest mining company, fell 2.2 percent after prices of metals used in manufacturing, like copper, sank.

Mainland Chinese markets were lower a day after the country's national statistics bureau released figures showing inflation had eased slightly but still remained higher than expected. The Shanghai Composite Index dropped 0.7 percent to 2,865.06.

The latest inflation figures could lead the central bank to keep controls on lending and liquidity — resulting in less money to put into stocks — and could put pressure on China to allow the yuan to appreciate. That would make Chinese goods more expensive, thus dampen demand for them and lead to falling prices.

"The latest set of economic figures suggests the exchange rate will remain under pressure to appreciate and interest rates will continue to rise," DBS Bank Ltd. in Singapore said in a report.

The yuan, also known as the renminbi or people's money, has risen by about 5 percent against the U.S. dollar since Beijing promised greater flexibility last June. Washington and other critics say an undervalued yuan swells China's trade surplus and hurts foreign companies.

In the U.S., demand for gasoline fell by the largest amount in seven weeks, the Energy Information Administration said Wednesday, a signal that consumers are conserving money. A drop in consumer and business spending could hurt corporate earnings and halt a rally that has sent U.S. stock markets up 7 percent this year.

The fall in demand for gas means that traders will take a close look at Thursday's weekly report on first-time applications for unemployment benefits. If they rise, that could indicate companies are cutting back in other areas as well.

Wall Street fell broadly, a sign of uncertainty about the U.S. economic recovery. The Dow lost 1 percent to close at 12,630.03. The S&P 500 fell 1.1 percent to 1,342.08. The Nasdaq composite lost 0.9 percent to 2,845.06.

Benchmark crude for June delivery rose $1.07 to $99.28 a barrel in electronic trading on the New York Mercantile Exchange. The contract dropped $5.67 to settle at $98.21 per barrel on Wednesday.

In currencies, the euro was up at $1.4230 from $1.4196 late Wednesday. It was worth more than $1.49 just one week ago. The greenback rose to 81.10 yen from 80.97 yen.