Asian stock markets declined Monday after election results from Greece and France fueled concerns about Europe reviving the debt crisis.
Chinese Shanghai declined 0.07 percent to close at 2,451.95. South Korean KOSPI also declined 1.64 percent or 32.71 points to close at 1956.44.
The Eurozone crisis comes back into the spotlight after Greek voters flocked to anti-bailout political parties. The two main parties which supported austerity measures and the bailout package, the conservative New Democracy and the left-wing Pasok, faced heavy losses. There is growing fear in the market that the new government in Greece will end austerity measures, which may lead to a default on its huge debts.
In France, Socialist Francois Hollande, who defeated Nicolas Sarkozy, has already promised to push for less austerity. Sarkozy had led the efforts for a pan-European austerity drive, but his defeat has raised concerns in the market that Eurozone will face a renewed debt crisis.
“With growing influence of anti-austerity political blocs, tensions among the Eurozone will likely be intensified and a wave of renegotiations for bail-out programmes may be sparked,” Credit Agricole said in a note.
Hong Kong's Hang Seng fell 2.59 percent or 546.39 points to 20539.61, and many Hong Kong-listed banks and insurers were badly affected. HSBC Holdings PLC lost 2.4 percent and Bank of Communications Co lost 2.2 percent. Exporters who have high exposure to Europe also faced heavy losses.
Japanese Nikkei 225 fell 2.78 percent or 261.11 points to 9119.14, which is its lowest close in three months. Among the major losers,Honda Motor slumped 5.61 percent, Sony Corp fell 4.49 percent and Toyota Motor lost 2.96 percent. With the strengthening of the yen, there was heavy selling pressure among exporters and lenders.
In India, the Sensex turned positive by 81.63 points to 16912.71 after finance minister Pranab Mukherjee deferred the general anti-avoidance rule (GAAR) by one year.