Asian stocks tumble amid worries about US consumer

HONG KONG — Asian stocks fell sharply Monday as signs of weak U.S. consumer confidence aggravated doubts in the recovery’s strength, overshadowing news that Japan’s economy climbed out of its recession last quarter.

Markets in Tokyo, Shanghai and Hong Kong led the region’s declines, sliding nearly 3 percent, as investors rushed to take profits from the market’s recent run-up. Oil prices swooned along with equity prices, and the dollar fell against the yen.

Worries about the pace of economy recovery in the U.S. were partly to blame after a key report showed Friday American consumer confidence was weaker than expected in early August. Coupled with disappointing retail sales data, the report gave investors more reason to fear growth in the world’s largest economy will remain tepid for some time even once the recession is technically over.

Investors seemed little comforted by news that Japan’s economy grew 3.7 percent at an annual pace in the second quarter, signaling exports were gradually picking up after the nation’s steepest recession since the end of World War II.

Winson Fong, managing director at SG Asset Management in Hong Kong, said the region’s markets — many of which have posted gains above 50 percent this year — have been due for a correction. Friday’s consumer report was just the excuse.

“People have been getting nervous about the markets. We’re so overbought many people are moving to take profit,” said Fong, who helps oversee about $2 billion in Asian equities. “We don’t need to worry too much about the fundamentals for now, but in the next couple weeks we may see some more selling.”

Japan’s Nikkei 225 stock average tumbled 279.23 points, or 2.6 percent, to 10,318.10. In greater China, Hong Kong’s Hang Seng dived 2.8 percent to 20,313.46 and Shanghai’s benchmark lost 2.8 percent to 2,963.09.

Korea’s Kospi dropped 1.6 percent in 1,565.49 and India’s Sensex shed 1.8 percent. Markets in Taiwan, Australia and Singapore fell back over 1 percent.

In the U.S. Friday, the Dow Jones industrial average fell 76.79, or 0.8 percent, to 9,321.40 after falling as much as 165 points after the consumer sentiment survey was released. The S&P 500 index fell 8.64, or 0.9 percent, to 1,004.09, while the Nasdaq composite index fell 23.83, or 1.2 percent, to 1,985.52.

U.S. futures pointed to more losses Monday.

Investors sold down oil prices in Asia, with benchmark crude for September delivery losing 57 cents to $66.94. The contract tanked $3.01 on Friday.

The dollar was lower at 94.61 yen from 94.78 yen. The euro traded down at $1.4152 compared to $1.4185 earlier.