Asian stock markets lower as sovereign debt worries linger; Nikkei down 1.5 percent

Asian markets lower as debt worries linger

BANGKOK — Asian stock markets mostly fell Thursday, extending losses to a third day, as shaky government finances continued to unnerve investors and weak economic figures in Japan raised more concerns about its recovery.

The region’s retreat came despite gains Wednesday on Wall Street. Oil diving below $71 a barrel weighed on commodity stocks while the dollar fell against the yen and rose versus the euro.

Recent unease about the consequences of governments piling up massive debts as they massage battered economies with unprecedented stimulus spending was reinforced by Standard & Poor’s lowering its credit rating outlook on Spain to negative. That move added to warnings from other ratings agencies about government finances in Britain and the U.S., a downgrade of Greece’s rating, and cuts to ratings on state-linked companies in debt-soaked Dubai.

Economic news in Asia added to the case for investors to remain wary of a sell-off in markets, which have risen dramatically from their crisis lows in March.

Japan’s core machinery orders, a closely watched indicator of corporate capital spending, tumbled 4.5 percent in October from a month earlier, suggesting that companies are reigning in spending as the recovery in the world’s No. 2 economy slows. A day before, Japan slashed its third quarter growth figure, indicating the economy is much weaker than previously feared.

Ben Kwong Man Bun, the chief operating officer at KGI Asia Limited in Hong Kong, said uncertainties surrounding the U.S. economy and the financial system given troubles in Dubai and other countries were leading investors to book gains from this year’s rally.

“All this is a very good excuse to lock in their profits and go on holiday before the end of the year,” he said. “Market sentiment remains relatively cautious.”

Tokyo’s benchmark Nikkei 225 stock average — also pressured by a rising yen which cuts exporter profits — was down 154.07 points, or 1.5 percent, at 9,850.65. Hong Kong’s Hang Seng retreated 164.67, or 0.8 percent, to 21,577.09 and South Korea’s Kospi dropped 18.77, or 1.2 percent, to 1,615.59.

Australia’s market shed 0.7 percent despite news that unemployment dropped again in November, with resource giants like BHP Billiton falling amid a lower oil price. China’s Shanghai index fell 0.1 percent.

Bucking the trend, Indonesia’s index climbed 0.2 percent. Thailand’s stock market was closed for a national holiday.

In the U.S. Wednesday, the Dow rose 51.08, or 0.5 percent, to 10,337.05 after falling 104 on Tuesday. The Dow crossed cross the unchanged mark 59 times.

The broader S&P 500 index rose 4.01, or 0.4 percent, to 1,095.95, its first gain of the week. The Nasdaq composite index rose 10.74, or 0.5 percent, to 2,183.73.

Oil prices hung below $71 a barrel in Asia amid growing investor concern that U.S. crude demand isn’t improving.

Benchmark crude for January delivery was down 2 cents to $70.65 in electronic trading on the New York Mercantile Exchange. The contract dropped $1.95 to settle at $70.67 on Wednesday.

Gold rose $6.70, or 0.6 percent, to $1,127.50 an ounce.

In currencies, the dollar dropped to 87.83 yen from 87.88. The euro fell to $1.4706 from $1.726.