Asia stocks slump in post-holiday trade; Nikkei dips 0.2%

Investing.com – Asian stock markets declined in thin year-end trade on Wednesday, as markets in Hong Kong and Australia reopened after an extended holiday break, while shares in Japan came under pressure ahead of an Italian bond sale later this week.  

During late Asian trade, Hong Kong's Hang Seng Index fell 0.75%, Australia’s S&P/ASX200 tumbled 1.25%, while Japan’s Nikkei 225 Index dipped 0.2%.

Trading volumes were thin in many markets ahead of the New Year’s holiday, resulting in low liquidity and irregular volatility.

Investors were also cautious ahead of an auction of short-term Italian debt later in the day. The yield on Italy’s ten-year bonds topped the critical 7% threshold on Wednesday, widely viewed as unsustainable in the long-term.

Shares in Japanese lenders performed poorly, with investment banks Nomura Holdings and Daiwa Securities slumping 1.65% and 1.25% respectively, while Sumitomo Mitsui Financial Group saw shares retreat 1.8%.

Many of the big name Japanese exporters were lower, amid the uncertain global economic outlook. Consumer electronics giant Sony saw shares fall 2.4%, rival Sharp dropped 3.2%, while digital camera maker Canon declined 1.6%.  

Meanwhile, shares in troubled nuclear power plant operator Tokyo Electric Power Company plunged 11.85% after Japan's trade minister Yukio Edano urged the utility to consider temporarily going under state control.

Elsewhere, in Hong Kong, shares in metal producers led losses, tracking copper and gold prices lower. Gold producer Zijin Mining Group saw shares fall 3.3%, copper producer Jiangxi Copper Company slumped 1.75%, while Aluminum Corporation of China dropped 2.85%.

Hong Kong-listed shares of China’s largest dairy maker China Mengniu Dairy plummeted 23.5% after acknowledging that a cancer-causing toxin had been found in milk produced by the company.

Meanwhile, in Australia, miners led losses, with BHP Billiton and Rio Tinto falling 1.65% and 2.15% respectively, while shares in gold producer Newcrest Mining slumped 2.2%.

Looking ahead, the outlook for European stock markets was downbeat. The EURO STOXX 50 futures pointed to a loss of 0.3%, France’s CAC 40 futures shed 0.25%, while Germany's DAX futures pointed to a drop of 0.5%.

U.S. stock indices edged lower on Tuesday after data showed that U.S. consumer confidence climbed to the highest level since April, while the S&P/Case-Shiller home price index fell more-than-expected in October, declining for the 16th consecutive month.