Asian stock markets are extending losses on Wednesday from the previous session, as worries about global economic growth continued to weigh on investor sentiment. Concerns about the health of European banks and the volatility in crude oil prices have increased risk aversion. The Japanese and Australian markets are down with significant losses.
Investors are treading cautiously as they look ahead to remarks by Federal Reserve Chair Janet Yellen, who is scheduled to testify before the House Financial Services Committee later in the day. Yellen will be grilled on Capitol Hill about the condition of the U.S. economy and outlook for interest rates.
The Australian market is notably lower, following the lackluster cues overnight from Wall Street and the fall in crude oil as well as other commodity prices. Investors are also digesting corporate earnings reports.
In late-morning trades, the benchmark S&P/ASX200 Index is losing 62.40 points or 1.29 percent to 4,769.70, off a low of 4,765.10 earlier. The broader All Ordinaries Index is down 54.80 points or 1.12 percent to 4,827.80.
In the banking space, ANZ Banking, Westpac Banking and National Australia Bank are lower in a range of 1.3 percent to almost 3 percent.
Meanwhile, Commonwealth Bank is advancing more than 1 percent after the bank reported an almost 4 percent increase in its cash profit for the first half of the year to A$4.8 billion.
Among oil stocks, Oil Search is declining almost 3 percent, Santos is down more than 4 percent and Woodside Petroleum is lower by more than 2 percent.
In the mining sector, BHP Billiton is lower by more than 3 percent, Rio Tinto is down almost 2 percent and Fortescue Metals is losing almost 3 percent.
Gold miner Newcrest Mining is lower by more than 3 percent and Evolution Mining is declining more than 2 percent.
CIMIC Group reported a 20 percent increase in underlying profit for fiscal 2015 and said it has entered 2016 with a stronger base. Shares of the construction and contract mining group are gaining almost 8 percent.
Energy retailer AGL Energy posted a net loss for the half year on writedowns following its decision to exit natural gas exploration and production. However, its underlying profit increased. The company's shares are adding 0.6 percent.
Building products maker Boral reported a 31 percent increase in profit for the half year. The company's shares are rising more than 2 percent.
In economic news, the latest survey from Westpac Bank and the Melbourne Institute revealed that consumer confidence in Australia climbed in February, surging 4.2 percent to a score of 101.3.
That follows the 3.5 percent decline in January to a reading of 97.3. It also moves back above the boom-or-bust line of 100 that separates optimists from pessimists.
In the currency market, the Australian dollar is marginally higher against the U.S. dollar on Wednesday, ahead of U.S. Federal Reserve chair Janet Yellen's testimony to Congress. In early trades, the local unit was trading at US$0.7064, down from Tuesday's close of US$0.7037.
The Japanese market pared early gains gains and slipped into negative territory on Wednesday to its lowest level since October 2014, with the lackluster cues overnight from Wall Street and worries about global economic growth denting investor sentiment. The stronger yen too weighed on exporters' stocks.
In late-morning trades, the benchmark Nikkei 225 Index is losing 421.80 points or 2.62 percent to 15,663.64, off a low of 15,626.04 earlier. On Tuesday, the Nikkei index had closed 5.4 percent lower.
Among the major exporters, Sony is declining almost 2 percent and Canon is down almost 3 percent. Meanwhile, Panasonic is adding 0.3 percent, Hitachi is up 0.2 percent and Toshiba is rising 0.8 percent.
In the banking space, Mitsubishi UFJ Financial is lower by almost 4 percent and Resona Holdings is declining more than 2 percent.
Oil stock Inpex is declining almost 2 percent and JX Holdings is losing almost 3 percent.
Among the other major losers, Toho Zinc is losing almost 6 percent, Shinsei Bank is down 5 percent and Nichirei Corp. is lower by almost 5 percent.
On the economic front, the Bank of Japan said that producer prices in Japan were down 0.9 percent on month in January. That missed forecasts for a decline of 0.7 percent following the 0.4 percent contraction in December.
On a yearly basis, producer prices skidded 3.1 percent - also shy of expectations for a fall of 2.8 percent following the 3.5 percent decline in the previous month.
Japan will also see January numbers for housing loans and Tokyo office vacancies later today.
In the currency market, the U.S. dollar traded in the lower 115 yen-level on Wednesday, down slightly from Tuesday's close in Tokyo.
Elsewhere in Asia, Singapore is down almost 2 percent, New Zealand is declining 1 percent, Malaysia is lower by almost 1 percent and Indonesia is edging down 0.2 percent. The markets in South Korea, Taiwan, China and Hong Kong remain closed for the Lunar New Year holiday.
On Wall Street, stocks closed modestly lower in a volatile trading session on Tuesday as traders kept a close eye on the price of crude oil and also looked ahead to remarks by Federal Reserve Chair Janet Yellen, who is scheduled to testify before the House Financial Services Committee on Wednesday.
The Dow edged down 12.67 points or 0.1 percent to 16,014.38, the Nasdaq fell 14.99 points or 0.4 percent to 4,286.76 and the S&P 500 dipped 1.23 points or 0.1 percent to 1,852.21.
The major European markets also showed notable moves to the downside on Tuesday. While the French CAC 40 Index tumbled by 1.7 percent, the German DAX Index and the U.K.'s FTSE 100 Index dropped by 1.1 percent and 1 percent, respectively.
Crude oil prices tumbled for a fourth straight session Tuesday amid expectations that global demand for energy products will dwindle this year. Crude for March delivery ended the session down $1.75 or 5.9 percent at $27.94 a barrel on the New York Mercantile Exchange.
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