Asia shares extend losses after Wall St slip

A pedestrian passes before a share prices board in Tokyo on June 19, 2014
A pedestrian passes before a share prices board in Tokyo on June 19, 2014 (AFP Photo/Yoshikazu Tsuno)

Asian markets sank Wednesday, following a negative lead from Wall Street and talk of a possible correction for global equities after their rally over the past few weeks.

China released data showing inflation eased slightly in June after hitting a four-month high in May.

Sydney slumped 1.06 percent, or 58.4 points, to 5,452.5 and Seoul fell 0.31 percent, or 6.16 points, to 2,000.50. Tokyo clawed back most of the day's losses to end flat, dipping 11.76 points to 15,276.25.

Shanghai lost 1.23 percent, or 25.41 points, to finish at 2,038.61 while Hong Kong tumbled 1.55 percent, or 365.31 points, to 23,176.07.

Jakarta was closed for the presidential election.

US shares retreated on Tuesday for a second straight session after returning from the long, Independence Day weekend. The S&P 500 and Dow had closed Thursday at record highs after a better-than-expected report on US jobs creation.

The Dow slipped 0.69 percent, the S&P 500 fell 0.70 percent and the Nasdaq tumbled 1.35 percent.

Some observers have predicted a pullback after the latest surge across global markets. Nobel prizewinning economist Joseph Stiglitz said this week he was "very uncomfortable" with current prices.

There are also concerns that the Federal Reserve could accelerate its plan to raise interest rates next year in light of recent upbeat economic data out of Washington.

In China the National Bureau of Statistics said annual inflation came in at 2.3 percent last month, down from 2.5 percent in May.

The figure is slightly below the 2.4 percent forecast by economists for Dow Jones Newswires and well short of the 3.5 percent annual target set by Beijing.

Traders will now be keeping a close eye on Thursday's trade statistics and the release next week of April-June economic growth data, hoping for an improvement on the previous three months.

On currency markets the dollar's advances against the yen last week have been all but eliminated.

In afternoon Tokyo trade the greenback was quoted at 101.64 yen, against 101.57 yen in New York but well below the 102.11 level touched on Monday in Japan.

The euro bought $1.3616 and 138.40 yen compared with $1.3611 and 138.24.

Oil prices were mixed. US benchmark West Texas Intermediate for August delivery lost 12 cents to $103.28, while Brent crude was down 45 cents at $108.50 in afternoon trade.

Gold fetched $1,323.20 an ounce at 0805 GMT compared with $1,322.43 late Tuesday.

In other markets:

-- Taipei slipped 0.43 percent, or 41.0 points, to 9,489.98.

Taiwan Semiconductor Manufacturing Co. fell 0.37 percent to Tw$134.0 while Hon Hai rose 0.48 percent to Tw$105.0.

-- Wellington fell 0.84 percent, or 43.33 points, to 5,122.74.

Trade Me dipped 2.49 percent to NZ$3.53 and Chorus was off 0.58 percent at NZ$1.72.

-- Manila closed 0.64 percent lower, giving up 44.73 points to 6,903.79.