Asian markets decline

Fears that the global recovery may lose steam weighed on Asian shares Wednesday as China moved to curb its credit boom and Wall Street's earnings season got off to a weak start. "The selling is unstoppable," said Hideaki Higashi, a strategist at SMBC Friend Securities.
Beijing's move to raise the amount of money banks must hold in reserves by 50 basis points sent Hong Kong shares tumbling 2.59 percent and Shanghai 3.09 percent, the heaviest falls so far this year for both bourses. Beijing's decision followed a move to raise the yield on one-year Chinese government bills for the first time in five months, after last week's similar move on another benchmark sale, in a sign of tighter borrowing costs.
"Investors' sentiment was hurt by the sooner-than-expected reserve requirement ratio hike while concerns over further monetary tightening will make investors more cautious in the future," Citic Securities analyst Yu Jun told Dow Jones Newswires. Sydney lost 31.4 points, or 0.64 percent, to 4,868.10, led by resources as investors took fright at China's tightening moves. "Anything from stocks to currencies exposed to China are being sold," said IG Markets research analyst Ben Potter. "The market wasn't expecting the measures so soon."
Engineering and maintenance group WorleyParsons dropped 11.4 percent to 25.99 Australian dollars (24 US dollars) after lowering its 2010 full-year profit guidance. Seoul's KOSPI closed down 27.23 points, or 1.60 percent, at 1,671.14 led by steelmakers, shipbuilders and brokerages on concerns China may soon raise interest rates. Singapore was down 0.62 percent in the afternoon.
In other markets, Taipei closed down 112.81 points, or 1.36 percent, at 8,196.56 on concerns China may take further steps to prevent overheating, dealers said. "It may take the market a day or two to digest the selling pressure," said Mars Hsu of Grand Cathay Securities. Manila closed 0.29 percent, or 8.92 points, down with the composite index ending at 3,096.70. Top traded Philippine Long Distance Telephone shed 1.1 percent to 2,700 pesos. Wellington's NZX-50 index fell 0.43 percent, or 14.01 points, to 3,276.20.