Asian Shares Retreat As Brexit Worries Linger

(RTTNews) - Most Asian stocks fell on Tuesday, as falling oil prices on worries about global growth and renewed strength in the yen added to the impending uncertainty over the outcome of the UK's EU referendum.

Chinese shares eked out modest gains ahead of MSCI's decision on whether to add Chinese A-shares to its Emerging Markets Index. The benchmark Shanghai Composite index rose 9.12 points or 0.32 percent to 2,842.19 after tumbling 3.2 percent on Monday in the wake of disappointing data. Hong Kong's Hang Seng index dropped 125.46 points or 0.61 percent to 20,387.53.

Japanese shares hit nine-week lows as falling government bond yields and a strengthening yen kept financials and exporters under pressure. The yen stood near a three-year high against the euro and hovered near six-week highs against the dollar despite Finance Minister Taro Aso issuing a warning on the yen strength and claiming the right to intervene based on the G20 and G7 agreements.

The benchmark Nikkei fell 160.18 points or 1 percent to 15,859 after Monday's 3.5 percent slide. The broader Topix index closed 0.98 percent lower at 1,271.93. Mizuho Financial Group, Mitsubishi UFJ Financial and Sumitomo Mitsui Financial fell 1-2 percent as bond yields slipped to new record lows on worries over a possible British exit from the European Union.

Among exporters, Canon, Honda Motor, Mazda, Panasonic and Sharp Corp lost 1-3 percent. Apparel store operator Shimamura gained 2 percent on a Nikkei report that its group operating profit apparently jumped 30 percent in the March-May period from a year earlier.

On the economic front, Japan's industrial production increased more than initially estimated in April, final data published by the Ministry of Economy, Trade and Industry showed. Industrial production grew 0.5 percent in April from March instead of 0.3 percent reported initially. However, it was much slower than the 3.8 percent gain in the preceding month.

Australian shares hit seven-week lows as trading resumed after a holiday on Monday for the Queen's Birthday. The benchmark S&P/ASX 200 index fell 109.30 points or 2.06 percent to 5,203.30 as caution crept in ahead of key central bank meetings this week and the Brexit vote in Britain next week. The broader All Ordinaries index closed down 109.10 points or 2.02 percent to finish at 5,282.50.

The big four banks fell over 2 percent each as global bond yields kept falling. Miner BHP Billiton tumbled 3.2 percent even as a court in Brazil dismissed a $5.7 billion civil lawsuit against Samacro, a joint venture between BHP Billiton and Brazil's Vale. Rival Rio Tinto dropped 1.4 percent and Fortescue Metals Group retreated 2.8 percent.

Oil & gas producer Woodside Petroleum shed 3 percent, Origin Energy lost 4.8 percent and Santos fell as much as 7 percent after oil prices failed to hold onto the psychologically key $50 level.

Telecommunications provider Telstra lost 2 percent and blood products maker CSL fell 3.3 percent. Biotech group Mesoblast plummeted 42 percent after its partner Teva Pharmaceutical Industries pulled out of its late-stage trial of experimental stem cell therapy for heart failure.

In economic releases, the latest survey from National Australia Bank showed that Australia's business confidence weakened further in May. The NAB business confidence index dropped to 3.0 from 5.0 in April.

Seoul shares fell for the fourth day amid renewed fears over a British exit from the European Union. The Kospi average dropped 7.03 points or 0.36 percent to 1,972.03 on selling by foreign and institutional investors.

While Lotte Group shares extended losses amid a widening investigation into alleged embezzlement by its founding family, shipping stocks posted strong gains on news of a major overhaul of the struggling industry. Hanjin Shipping soared 6.3 percent and its smaller rival Hyundai Merchant Marine advanced 2.4 percent.

New Zealand's benchmark NZX-50 index dropped 89.32 points or 1.29 percent to 6,834.95, falling for a second day as a wave of risk aversion swept across financial markets. Orion Health Group, Coats Group, Xero and Air New Zealand fell 3-4 percent. Spark New Zealand rose 2.4 percent on bargain hunting after its recent selloff.

Elsewhere, benchmark indexes in India, Indonesia, Malaysia and Singapore were down between 0.2 percent and 0.7 percent as investors await the FOMC meeting along with monetary policy announcements from the Bank of Japan, Bank of England and Swiss National Bank. The Taiwan Weighed rose half a percent.

U.S. stocks fell for a third straight session Monday, as lower oil prices, concerns about the U.K.'s referendum on EU membership and Sunday's terror attack in Orlando made investors jittery ahead of the Federal Reserve's meeting. The Dow dropped 0.7 percent, the tech-heavy Nasdaq fell 0.9 percent and the S&P 500 slid 0.8 percent.