Asian Stocks Slide Further on China Growth Fears

HONG KONG—Asian stock markets slid again on Tuesday over worries about slower economic growth in China and a possible snag in the deal for Greece to get its bailout money.

Japan's Nikkei 225 index dropped 0.8 percent to 9,619.59 and South Korea's Kospi shed 1.3 percent to 1,990.90. Hong Kong's Hang Seng lost 1.5 percent to 20,944.54 and mainland China's Shanghai Composite Index fell 1 percent to 2,417.29.

Australia's S&P/ASX 200 retreated 1.2 percent to 4,210.90. Benchmarks in Taiwan and Singapore also fell.

Investors continued to be pessimistic following Premier Wen Jiabao's announcement at the start of the national legislature's annual session on Monday that China, a key driver of the world economy, is lowering its economic growth target to 7.5 percent from the 8 percent level it has stood at for years.

The target underlines China's emphasis on better, not faster, growth.

Wen's announcement is cause "for some concern that China might not roll out so many pro-growth policies in the near future," said Jackson Wong, a vice president at Tanrich Securities.

Greece's long-running debt crisis also weighed on the markets because of worries not enough investors will swap their Greek government bonds for new ones that are worth less and pay lower interest.

Greece will learn by Thursday night what percentage of private creditors will participate in the bond swap. Without the debt relief, Greece won't get a second, €130 billion (US $172 billion) international bailout and would face a default on its debts.

“Before the close of business Thursday, we really don't know whether it's going to be a go,” said Wong. “So it just seems not to be very wise to get into market at this point.”

Investors may also be hanging back because they're waiting for the release of some key economic data over the next few days, Wong said. Those include a private report on U.S. payrolls on Wednesday, Chinese inflation on Thursday and US jobless data on Friday.

In Hong Kong, AIA Group Ltd. tumbled eight percent after New York-based insurer American International Group said it was selling off a substantial stake in the company to help repay the U.S. government for its financial crisis bailout.

On Wall Street on Monday, the Dow Jones industrial average edged 0.1 percent lower to close at 12,962.81 and the broader Standard & Poor's 500 dropped 0.4 percent to 1,364.33. The Nasdaq composite index fell 0.9 percent to 2,950.48.

In currencies, the euro fell to $1.3193 from 1.3224 in late trading Monday. The dollar fell to 81.37 yen from 81.46 yen.

Benchmark crude for April delivery fell seven cents to $106.65 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose two cents to settle at $106.72 per barrel on Monday.