Asian shares follow Wall Street down after poor US data

Asian markets slumped on Tuesday – led by a four percent fall in Tokyo – following a huge sell-off on Wall Street as disappointing US manufacturing data compounded already deep fears about emerging markets. Traders were also spooked by a warning from US Treasury Secretary Jacob Lew, who warned that the United States’ borrowing limit will be reached on Friday, renewing fears of a Washington stand-off and possible default. Tokyo dived 4.18 percent, or 610.66 points, to 14,008.47. The losses leave the Nikkei 14 percent down since the start of the year, having surged 57 percent in 2013 to mark its best year in four decades. Seoul fell 1.73 percent, or 33.11 points at 1,886.85 and Sydney lost 1.75 percent, or 90.8 points, to 5,097.1, while Wellington was 0.97 percent, or 46.88 points, lower at 4,802.62. In the afternoon Hong Kong sank 2.15 percent. Shanghai and Taipei were closed for the Lunar New Year holiday. US stocks took a hammering on Monday after the Institute for Supply Management said its purchasing managers index (PMI) of manufacturing activity fell to 51.3 in January from 56.5 in December. A figure above growth indicates growth and anything below points to contraction. On Wall Street the Dow closed down 2.08 percent, the S&P 500 fell 2.28 percent and the Nasdaq 2.61 percent, according to AFP.