Asian stock markets fall on global economic fears

Shares in Asian markets have fallen on Wednesday, tracking US declines, after figures showed that the US economy is struggling to recover.

Japan's Nikkei 225 index fell 2.2% in early trade. Benchmark indices in South Korea, Hong Kong and Australia were also down more than 2%.
Wall Street closed more than 2% lower on Tuesday after data showed US consumer spending declined in June.
European markets also fell as debt fears there came back into focus.
A deal signed in Washington on US debt levels failed to lift sentiment.
Oil prices have also been falling in Asian trade, with US light sweet crude for September delivery easing 49 cents to $93.30 a barrel and Brent crude for September delivery dropping 65 cents to $115.81.
Shifting worries
US lawmakers managed to avoid a debt default by raising the debt ceiling. However, analysts say there has been a sharp change in global focus from the US debt issues.
"I think the conditions have completely changed this week," said Koichi Ono from Daiwa Securities Capital Markets in Tokyo.
"Until last week, people have been saying the US debt ceiling was the problem. Now they talk about worries about the health of the economy."

It's a pretty bleak picture”

End Quote Justin Gallagher RBS

This was underscored by the official data which came out on Tuesday showing a fall in US consumer spending for the first time in nearly two years.

The figures also showed that incomes had barely risen, indicating that the economy was stalling in the first half of this year.
"There certainly have been weaker numbers globally, particularly out of the US," said Greg Gibbs from RBS in Sydney.
"There is already a high level of uncertainty in global markets and that's another layer which is impacting on sentiment."
Euro pressures
And it's not just the US dragging down Asian markets, say analysts.
Just as the US debt crisis seems to be subsiding, the European crisis has come back into focus.
Spain and Italy are under renewed pressure because of concerns that the eurozone bailout fund is not enough to protect their larger economies if they can no longer pay their debts.
Bond yields, or the interest countries pay on their loans, have risen sharply in recent days.
"It's a pretty bleak picture," said Justin Gallagher of RBS in Sydney.
"The implications for the Italian market and economy going through something similar to Greece is pretty frightening. People are suggesting it's not bailout-able. That's how big it is."
The MSCI's broadest index of Asia Pacific shares fell 2.3%.
Australian shares fell 2%, while South Korean stocks declined more than 2.5%.
Source: BBC News