Asian markets slip on global jitters

Tokyo: Japan's Nikkei share average fell on Tuesday after the failure of US trading firm MF Global Holdings and fresh worries about Europe raised concerns on the global economic outlook, prompting profit-taking.

Panasonic skidded 3.8 per cent after it said on Monday that it expects to post an annual net loss of 420 billion yen ($5.5 billion), its biggest in a decade, as it cut unprofitable businesses deeper and faster than first planned.

The Nikkei average fell 0.9 per cent to 8,909.05, slipping further from Monday' three-month intraday high of 9,152.39, hit just after Japanese government stepped into the currency market to stem the yen's strength.

Market players said they think the Nikkei is still in an uptrend from a low hit in early October as long as it stays above major support at its 25-day moving average, at 8,728 on Tuesday.

The broader Topix index dropped 0.6 per cent to 759.28.

Although the euro zone's bailout package announced last week and a string of reasonably strong US data had eased concerns about the global economy, market players remained on guard against potential pitfalls.

In the United States, trading firm MF Global Holdings collapsed on making bad bets on euro zone debts while in Europe, Italian and Spanish bond yields soared.

The Greek Prime Minister called an unexpected referendum on the EU bailout deal for his debt-ridden country raising uncertainty over the fate of the aid scheme.

"I think the global outlook will dictate where Japanese shares will be going. At the moment, there is selling above the 9,000 mark in the Nikkei," said Toshiyuki Kanayama, a market analyst at Monex Securities.

Market players are also keeping an eye on the yen, a day after Japanese intervention pushed back the currency from record highs. They say the move has failed to dispel scepticism in the stock market that the currency's strength will likely squeeze Japanese exporters' bottom line.

Japanese exporters' earning outlook has been hurt by the yen's recent strength and supply chain disruptions due to flooding in Thailand.