TOKYO (AP) — Shares fell Thursday in Asia as weak economic data from China and Japan deepened concerns over ongoing reductions in U.S. monetary stimulus.
Japan's Nikkei 225 index was down 2.6 percent at 14,887.96 after the government reported that retail sales fell 1.1 percent in December from the month before.
After a euphoric rise in Japan's stock market last year, sentiment has dimmed as the Japanese yen reversed some of its weakness against the U.S. dollar, raising worries over the potential impact on exporters.
The recent volatility in emerging market currencies has led investors to shift toward "safe haven" currencies such as the yen and dollar.
The release of a survey confirming that China's manufacturing contracted in January added to the gloom, with Hong Kong's Hang Seng down 0.5 percent to 22,035.42.
Markets in Taiwan and South Korea were closed on the eve of the lunar new year. Shares in Australia, New Zealand, mainland China, Indonesia, Singapore and the Philippines fell, while Malaysian shares rose.
Stocks got a temporary boost Wednesday from aggressive interest rate hikes by the Turkish central bank aimed at stabilizing the lira and keeping inflation in check.
The U.S. Federal Reserve's decision to further "taper," or reduce, its mortgage and long-term bond purchases was a major factor in roiling Asian markets Thursday.
The monthly purchases have supported U.S. economic recovery by keeping interest rates low but also sent money into stocks and other assets with higher returns. The Fed is reducing stimulus as hiring and other economic indicators have improved.
Overnight, disappointing earnings from big U.S. companies, ongoing jitters in emerging markets and the Fed's announcement combined to drag Wall Street lower for the fourth day out of the last five.
The Standard & Poor's fell 18.30 points, or 1 percent, to 1,774.20. The Dow Jones industrial average fell 189.77 points, or 1.2 percent, to 15,738.79. The Nasdaq composite dropped 46.53 points, or 1.1 percent, to 4,051.43.
In Europe, Germany's DAX fell 0.8 percent to close at 9,336.73. Britain's FTSE fell 0.4 percent to 6,544.28, while France's CAC 40 lose 0.7 percent to 4,156.98.
In other markets, benchmark oil for March delivery was up 16 cents to $97.52 a barrel in electronic trading on the New York Mercantile Exchange. The contract slipped 5 cents to close at $97.36 on Wednesday.
In currencies, the euro fell 0.1 percent to $1.3650. The dollar was little changed at 102.41 yen.