HONG KONG – Asian stocks were mostly lower on Wednesday, weighed down by concerns over a slowdown in China’s economy, while oil prices edged back up after big falls in New York.
Receding concerns over the eurozone debt crisis provided support for the euro, which continued its thrust upwards against the yen and greenback.
Tokyo fell 0.21 percent by the break in the first trading session after closing Monday at its highest level since the quake-tsunami disaster in March last year. Sydney was 0.33 percent off and Seoul fell 0.62 percent.
Hong Kong shed 0.33 percent and Shanghai was 0.32 percent lower.
Concerns about China were raised on Tuesday when BHP Billiton said the country’s demand for iron ore looked to be flattening as its economy slows, with exports weakening.
The comments by BHP’s iron ore president Ian Ashby added to recent data that showed China’s biggest trade deficit in February since records began, manufacturing activity plodding and inflation at its lowest since June 2010.
It also comes after China cut its growth target to 7.5 percent for 2012 from last year’s 9.2 percent growth and 10.4 percent in 2010.
Regional countries rely on fast-growing China to help drive their own economic expansion.
“Clearly any signs of a Chinese slowdown will manifest negatively,” Christopher Gore, currency analyst at Go Markets, said in a note according to Dow Jones Newswires.
“However the question remains, are we witnessing a hard-landing scenario in motion or China’s grand plan to promote sustainable long-term growth?”
The news weighed on US shares. On Wall Street the Dow index lost 0.52 percent, the S&P 500 index fell 0.30 percent and the tech-heavy Nasdaq was 0.14 percent lower.
Oil prices edged up on news of a huge fall in stockpiles in the United States.
The cost of the black gold has been fuelled by the ongoing standoff between Iran and the West over Tehran’s nuclear programme, which Washington and its allies claim is being used to build a bomb.
Oil was up in Asian trade Wednesday, with New York’s main contract, light sweet crude for delivery in May, rising 54 cents to $106.61 and Brent North Sea crude for May up 28 cents at 124.40.
Prices fell heavily on Tuesday in New York after Saudi Arabia said it was ready to help stabilise the market by making up for a supply shortfall to compensate for lost Iranian output caused by strict US sanctions.
The International Monetary Fund on Tuesday warned that a sharp spike in oil prices could hammer global growth.
IMF managing director Christine Lagarde estimated that crude oil prices could jump by up to 30 percent if Iranian supplies were disrupted, causing “serious consequences” for the global economy.
The euro rose further as European sovereign debt worries eased after Greece on Tuesday received a payment of 7.5 billion euros under its second international bailout.
The common unit bought 111.07 yen in early Asian trade on Wednesday, up from 110.66 yen in New York late Tuesday, where it had hit 111.57 — its highest since October 31.
It also gained to $1.3275 from $1.3222, while the dollar was at 83.65 yen, from 83.70 yen.
The dollar may climb back above 84.00 yen if February home sales due later Wednesday show further signs of improvement in the US housing market, said Masafumi Yamamoto, chief forex strategist at Barclays Capital.
Gold was at $1,654.30 an ounce at 0200 GMT, compared with $1,648.48 late Tuesday.