SINGAPORE—Asian shares dropped sharply Monday, and the euro slumped to multi-year lows against the yen on fresh concerns of a Greek debt default, with the Tokyo stock market skidding to its lowest level in almost six months.
Wall Street's sharp drop on Friday and the renewed euro-zone woes sent investors scurrying out of riskier stocks into the safe-haven bonds and yen. Oil prices fell.
"Chronic uncertainty on Europe is keeping investors sidelined," said Shaw Stockbroking head of trading Jamie Spiteri in Sydney. "There's decreasing trust in equity markets, so cash is increasingly being preserved."
Japan's Nikkei Stock Average was down 2.1%, Australia's S&P/ASX 200 fell 3.3%, while Hong Kong's Hang Seng Index slumped 3.4% and India's Sensex declined 1.5%. Markets in South Korea, China and Taiwan were closed for a holiday.
Dow Jones Industrial Average futures were down 82 points in screen trade.
The euro remained under pressure in Asia after falling sharply on Friday, amid the Greek default worries and apparent divisions in the European Central Bank board.
The surprise resignation Friday of ECB executive committee member Jürgen Stark, who had opposed the bank's move to buy the bonds of struggling euro-zone countries, further underscored the discord among European officials on how to resolve the region's deepening economic problems.
"We are watching Greece, and only Greece," said Satoshi Tate, a senior dealer at Mizuho Corporate Bank. "Conditions are getting very serious and everyone is worried how the issue will unfold."
The single currency tapped a fresh 10-year low against the yen at ¥104.90 and a seven-month low of $1.3550 against the U.S. dollar in early Asian trade. The Australian dollar, a regional barometer of risk, fell to US$1.0365 from US$1.0415 earlier in the day.
In recent trade, the euro was fetching ¥105.26, from ¥105.94 late in New York Friday, and at $1.3581, from $1.3648. The dollar was at ¥77.51, compared with ¥77.74.
In Tokyo, the yen's spike against the euro sent stocks tumbling with exporters bearing the brunt of the selloff. The Nikkei plummeted to its lowest level since March 15 at 8529.06 on the open.
Honda Motor was off 3.8%, Sony dropped 3.0% and industrial concern Fanuc lost 3.0%, as investors worried that the global woes would further hurt Japan's recovery from the devastating March 11 natural disasters.
Cyclical and growth-sensitive stocks were sold off in Sydney, and elsewhere. The Australian market slipped to a fresh four-week low of 4047.6, with major banks down 3.1%-4.2%, and BHP Billiton off 3.2%.
In Hong Hong, HSBC tumbled 4.3% to a more than two-year low of HK$62.15 due to worries over its exposure to Europe.
December Japanese government bond futures were up 0.13 at 142.64 points.
Nymex crude for October delivery was down $1.25 at $85.99 per barrel on Globex, while spot gold was at $1,853.90 a troy ounce, down $4.70 from New York Friday.
Write to Shri Navaratnam at shri.navaratnam@dowjones.com
