Singapore: Japanese shares fell on Wednesday, dragged down mainly by hi-tech firms, while the euro wobbled after French and German leaders failed to deliver a solution to the euro zone debt crisis and restore investor confidence after a global market rout.
Electronics stocks were weak across Asia after computer maker Dell slashed its 2012 sales forecast late on Tuesday, a deeply bearish signal not only for the shaky state of global demand but for other hi-tech manufacturers, many of which are listed in Tokyo, Seoul and Taipei.
Japan’s Nikkei fell 1%, with bellwether tech exporter Sony sliding 2.7% after it cut the price of its Playstation 3 gaming console to boost sales.
In South Korea, LG Electronics tumbled 4.5%, though the benchmark KOSPI stock index was little changed.
Adding to the cautious mood in Asia, S&P stock futures fell almost half a%, extending losses on Wall Street overnight.
“Investors have been dumping emerging markets stocks across the board for the first time in the post-Lehman era,” said a market report from TrimTabs Investment Research. “Investors are selling Asia without discrimination.”
The euro fell to $1.4370 from Tuesday’s session high of around $1.4470, as traders expected more downward pressure once markets in Europe open later in the day.
A hotly anticipated meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel fell short of producing a plan of dramatic action to tackle the euro zone’s debt crisis, an outcome many market watchers had anticipated.
While long-term deficit reduction has become a pressing problem for many developed economies, many investors fear that calls for immediate spending cuts in many euro zone countries and the United States could retard global growth further.
Germany reported on Tuesday that its economy came close to stalling in the second quarter, though other data showed US industrial output rose at its fasted pace in seven months in July, perhaps indicating the economy started the second half of the year on better footing than many analysts had feared.
Still, many fund managers see Asian markets as more promising investment targets than the United States and Europe.
“Asia is not immune to the developed world woes, as the region remains a key exporter,” said a survey of investment managers published on Wednesday by Singapore-based Russell Investments.
“However, the domestic story is becoming more and more powerful as countries look inward to drive future growth .”
MSCI’s broadest index of non-Japanese Asia Pacific shares edged higher, supported by gains in Hong Kong and Australia.
The index has lost around 10% since the start of the year, much of it in recent weeks, as sovereign debt problems in Europe and the United States and fears that the U.S. could slide back into recession prompted investors to sell equities and other riskier assets in both emerging and developed markets.
Shares in Hong Kong were boosted by a speech by Chinese Vice-Premier Li Keqiang in which he promised to open more sectors for investment from Hong Kong, while a rise in Australia’s main index was tempered by global concerns.
The dollar index against major currencies rose 0.1%. Against the yen, the dollar traded around 76.76 , down from more than 80 yen earlier in August.
Gold , attractive to some investors as a refuge from turmoil in currencies, bonds and shares, is one of the best-performing assets this year. It traded at $1,785 per ounce on Wednesday, little changed from the previous session around $30 below the peak it touched last week.
US crude oil futures were up 11 cents to $86.75 per barrel after sliding on Tuesday on worries that flagging global growth will dampen energy demand.