Asian stock markets drop after Wall Street resumes slide; HK off nearly 1 percent

Asian stocks drop after Wall Street resumes slide

HONG KONG — Asian stock markets retreated Thursday as an overnight slide on Wall Street undermined confidence ahead of a key U.S. jobs report and central bank decisions in Europe.

Selling hit almost every major market in the region, following losses in the U.S. and Europe that halted a couple days of gains in global markets after a dismal January. Oil prices were lower, while the dollar was little changed against the yen and higher versus the euro.

Sentiment took a hit after Wall Street, coming off a big two-day advance, closed lower as investors returned to worrying about the pace of recovery following a disappointing report about the U.S. services sector.

The Institute for Supply Management said its index of service activity rose to 50.5 in January from a revised 49.8 in December, missing expectations. The news overshadowed reports the private sector shed fewer jobs than expected and gave investors another reason to hold back before monthly national jobs data due out Friday.

Investors were also awaiting interest rate decisions and economic assessments from the European Central Bank and Bank of England. Both are expected to keep rates unchanged.

But the ECB’s comments about Greece’s unfolding debt crisis — among the uncertainties that has yanked markets lower in recent weeks — will be in focus.

The confluence of mixed economic data, worsening public finances and confusion over financial reforms has reversed last year’s bull run for now.

“It definitely dampens confidence at the moment,” said Lorraine Tan, director of equities research at Standard & Poor’s in Singapore. “What we are seeing is a correction in an overall bull market. For us this was overdue after the rally in the second half of last year.”

In Japan, the Nikkei 225 stock average lost 48.35 points, 0.5 percent, to 10,355.98, with Toyota continuing to drag on the market. Shares in the world’s largest automaker plummeted 5.4 percent ahead of its earnings release on Thursday, adding to steep losses amid its widening global recall.

Hong Kong’s Hang Seng fell 1.5 percent to 20,415.41. Shanghai’s main index was off 0.3 percent. Markets in India and Australia also fell. Down most of the day, South Korea’s market recovered to add 0.1 percent.

Wall Street futures pointed to a lower open in the U.S. Thursday.

On Wall Street Wednesday, the Dow fell 26.30, or 0.3 percent, to 10,270.55. The S&P 500 index fell 6.04, or 0.6 percent, to 1,097.28, while the Nasdaq rose 0.85, or less than 0.1 percent, to 2,190.91.

Oil prices were lower in Asia, with benchmark crude for March delivery off 24 cents at $76.75. The contract lost 25 cents overnight.

In currencies, the dollar was little changed at 90.95 yen. The euro was lower at $1.3870 from $1.3888.