Most Asian stock markets retreated Tuesday after weakness on Wall Street, as concerns about the global economy sapped enthusiasm over China‘s nearly $600 billion package to boost growth.
Tokyo’s Nikkei 225 index was down 272.13 points, or 3 percent, to 8,809.30 as the yen strengthened against the dollar. In Hong Kong, the Hang Seng benchmark was 2.2 percent lower at 14,407.45 points.
Australia’s benchmark fell 3.6 percent. Markets in Singapore, South Korea and India also declined.
The Shanghai Composite index, up earlier in the session, fell 1.5 percent despite figures showing the country’s inflation rate eased further last month.
By JEREMIAH MARQUEZ, AP Business Writer
Regional equities were up sharply Monday on hopes that China’s 4 trillion yuan ($586 billion) stimulus package, announced Sunday, would keep its economic growth from falling too fast and help fuel demand for exports from other Asian countries.
But the rally proved short lived amid fresh evidence of more economic troubles.
In the U.S., major electronics retailer Circuit City Stores Inc. filed for bankruptcy protection. Investors also speculated about the fate of General Motors Corp., Chrysler and Ford Motor Co. after the automakers met with lawmakers last week in hopes of securing financial help.
In Asia, Japan’s government reported the country’s current account surplus in September plunged almost 50 percent from a year earlier as export growth waned in the face of a global slowdown.
“It’s what I’d term a ‘fally:’ a rally based on fallacy,” Kirby Daley, senior strategist at Newedge Group in Hong Kong, said of Monday’s advance. “The fallacy being that the China stimulus package is the answer to all of Asia’s problems. While it will help and is a step in the right direction, it will not fully insulate Asia from feeling the impact of the global downturn.”