Alexa

Asian stocks down; China index tumbles

Asian stocks down; China index tumbles

Asian stocks dropped yesterday, with China's main index tumbling about 2.5 percent, as investors tread cautiously after a series of gains and looked for more signs of economic recovery.
The selling came after the region advanced for three straight days and showed just how volatile the markets have become as investors try to determine if this year's rally has more momentum given the world economy's fragile state. Shanghai shares retreated as investors digested comments from Premier Wen Jiabao, the country's top economic official, that China faced new problems and Beijing will keep up its stimulus measures because the recovery lacked a solid foundation.
"The sentiment is changing constantly right now because many investors are still worried if the liquidity and fundamentals still support these prices," said Linus Yip, a strategist at First Shanghai Securities in Hong Kong. "There's a lack of confidence and direction."
Japan's Nikkei 225 stock average lost 83.69 points, or 0.8 percent, to 10,497.36. The Shanghai Composite Index slid as much as 5 percent at one point before erasing losses. By midafternoon, it was down 80.96, or 2.7 percent, at 2,912.31, though the decline didn't sending regional markets tumbling like they did last week. Hong Kong's Hang Seng was off 1.1 percent at 20,302.64. South Korea's Kospi lost 0.5 percent. India's Sensex was up 0.2 percent.