HONG KONG: Asian shares were lower in early trade Wednesday as markets weighed positive US economic data against ongoing concerns about Europe's debt crisis and the region's anaemic growth.
New leaders in debt-ridden Italy and Greece have offered investors some hope that they can solve their fiscal woes, avoiding the spread of a debt crisis that has threatened to drag the world economy into recession.
However, the euro lost ground against the dollar and borrowing costs in Italy, Spain and even France rose amid concerns about the eurozone's debt financing, while figures released Tuesday showed the 17-nation bloc saw just 0.2 percent growth in the third quarter.
Tokyo was off 0.60 percent, Sydney was down 0.35 percent, and Seoul was 0.55 percent lower. Hong Kong's benchmark Hang Seng index lost 2.26 percent while Chinese shares fell 1.73 percent.
"The bigger worry for markets is the situation in the eurozone, which appears to be deteriorating by the day," Credit Agricole said in a note to clients.
"Contagion has spread across eurozone bond markets like wildfire and the lack of action to create a firewall means that there is little to extinguish it."
The interest rate Italy must pay on its 10-year bonds jumped back above the 7.0 percent level seen as unsustainable for the country to service its debt while Spanish 10-year government bonds rose to 6.341 percent.
Even France was punished, with its 10-year bonds at 3.683 percent, more than twice as much as regional economic powerhouse Germany must pay to borrow. (AFP)
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