Asian shares fell sharply today, with Japanese stocks touching a three-month low, as exporters such as Sony slid on concerns over US consumer spending and lower base metals prices hit miners.
The dollar steadied after losses on the previous day on data showing US consumer confidence at a three-month low in May, and oil dipped below $72 a barrel, after rising nearly 1 per cent on yesterday on a jump in demand from China.
Falls in Asian markets followed a steep drop on Wall Street, where a disappointing sales report from Wal-Mart, the world's largest retailer, heightened worries about a potential slowdown in US consumer spending due to high oil prices.
"For the first four months of the year, markets were shooting the lights out, there was plenty of good news," said Craig James, chief equities economist with Commonwealth Securities in Australia. "But now, investors are asking - where do we go from here?"
Tokyo's Nikkei ended the morning session down 1.8 per cent, having earlier fallen to its lowest level since February, and MSCI's broadest index of shares elsewhere in Asia was down 0.6 per cent at 2.05am.
All 30 components of the Dow Jones industrial average finished lower last night for the first time since September 2004. The Dow closed down 1.6 per cent and the Nasdaq Composite Index fell 2.1 per cent.