HONG KONG: Asian markets mostly fell at the end of another volatile session Tuesday, a day after a global rout that saw trading suspended in Chinese markets and US and European equities tank.
In echoes of the summer's turbulence that saw trillions wiped off valuations, most bourses in the region tumbled in the first few minutes of trade before bouncing in and out of positive territory throughout the day.
The selling on Monday was fuelled by gauges of Chinese factory activity contracting again in December, the latest evidence showing the world's number-two economy struggles with its lowest annual growth rates in 25 years.
The data -- combined with the expiration Friday of "circuit breaker" measures brought in to curb last year's share slump -- sent Shanghai stocks crashing almost seven percent.
Regulators halted trading early on Monday, the first day a new circuit breaker mechanism was in place.
"The main reason for yesterday's fall was concern that China's economy won't steadily pick up. The circuit breaker was more of an accelerant for the fall," Northeast Securities analyst Shen Zhengyang told AFP.
On Tuesday the market watchdog, the China Securities Regulatory Commission (CSRC), sought to calm the panic by defending the measure.
"The circuit breaker has a big impact in stabilising the market and its main function is to provide a 'cooling off period' for the market to avoid or reduce rushed decisions made during wide swings," it said in a statement on its verified microblog.
Shanghai fell a further three percent at the open Tuesday before swinging from red to green and finally ending 0.3 percent lower.
The losses came despite the central People's Bank of China injecting billions of dollars into financial markets to boost liquidity.
Hong Kong was 0.5 percent lower in the afternoon, having also enjoyed healthy buying spells.
Tokyo ended down 0.4 percent on the back of a stronger yen.
- 'Markets in suspense' -
Monday's disappointing manufacturing figures were followed later in the day by data suggesting US factory activity had also contracted last month.
"Economic indicators in both China and the US are weak. As they're the world's two biggest economies and the impact is huge, each new data point is keeping stock markets in suspense," Toshihiko Matsuno, chief strategist at SMBC Friend Securities, told Bloomberg News.
Shane Oliver, head of investment strategy in Sydney at AMP Capital Investors, said he expected the PBoC to further ease monetary policy to add to the six interest rate cuts between November 2014 and November 2015.
"We've been reminded that volatility in financial markets remains high and that the global economy still needs monetary policy support," he added.
The sharp declines in Asia Monday were followed by Europe and the United States, with Frankfurt the worst-hit, diving 4.3 percent. London and Paris also tumbled and later in the day all three main indexes on Wall Street were hammered.
On oil markets both main contracts edged up slightly. They had both surged in Asian trade Monday on the back of Middle East tensions fuelled by the row between Iran and Saudi Arabia but later retreated as fears over a global glut and weak demand returned.
US benchmark West Texas Intermediate was up 0.4 percent and Brent added 0.2 pAFP
- Key figures around 0730 GMT -
Tokyo - Nikkei 225: DOWN 0.4 percent at 18,374.00 (close)
Shanghai - composite: DOWN 0.3 percent at 3,287.71 (close)
Hong Kong - Hang Seng: DOWN 0.5 percent at 21,215.53
Euro/dollar: DOWN to $1.0823 from $1.0833 late Monday
Dollar/yen: UP at 119.51 yen from 119.42 yen
New York - Dow: DOWN 1.6 percent at 17,148.94 (close)
London - FTSE 100: DOWN 2.4 percent at 6,093.43 (close)
Paris - CAC 40: DOWN 2.5 percent at 4,522.45 (close)
Frankfurt - DAX 30: DOWN 4.3 percent at 10,283.44 (close)
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