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[HONG KONG] Asian equity markets sank on Wednesday following a heavy sell-off in New York, where a string of poor earnings reports stoked concerns about the US economy and put pressure on the dollar.
Traders are also keeping an eye on Europe as Greece's new anti-austerity government prepares to face off with its international creditors over its bailout.
Tokyo fell 0.20 per cent, Sydney lost 0.27 per cent, Hong Kong was 0.16 per cent lower, Shanghai sank 1.30 per cent and Seoul gave up 0.18 per cent.
Global investors - already nervous owing to political uncertainty in Greece, plunging oil prices and weak world economic growth - ran for cover in US trade Tuesday in response to negative reports from some of the world's biggest firms.
Caterpillar, Microsoft, conglomerate Procter & Gamble and mining giant Freeport-McMoRan all announced weak earnings or negative outlooks, sending their share prices plunging.
That sent Wall Street's three main indexes tumbling, with the Dow losing 1.65 per cent, the S&P 500 off 1.34 per cent and the Nasdaq shedding 1.89 per cent.
Adding to the negative sentiment was news that US durable goods orders unexpectedly tumbled 3.4 per cent in December, reminding investors that the US economy still has weak spots, especially its exposure to the global economic slowdown.
A Conference Board report showing US consumer confidence jumped in January to its highest level in more than seven years was unable to lift the mood.
After the market closed, Apple announced its quarterly profit rocketed to a corporate record of US$18 billion at the end of last year on booming sales of big-screen iPhone models, especially in China.
The dollar took a hit in US trade. The troubled euro - which hit a more than 11-year low below US$1.10 Monday - jumped above US$1.14 at one point in New York before easing slightly to US$1.1380 by the end of the day.
However, in early exchanges Wednesday the single currency retreated to US$1.1332.
The dollar was also 118.14 yen Wednesday in Tokyo, up from 117.90 yen in New York, where at one point it sank to 117.40 yen.
The euro remains in focus as the Greece's new far-left Syriza leadership prepares for a standoff with the European Union and International Monetary Fund.
The party won weekend elections after campaigning to renegotiate the country's vast bailout that came with painful terms including spending cuts and high taxes.
Both sides appear ready to fight with EU officials warning Prime Minister Alexis Tsipras not to seek any debt write-off or other radical change to the rescue programme.
"If the continuation of the programme of aid for Greece is called into question... Greek banks would lose access to central bank funds," Joachim Nagel, a member of the Bundesbank's executive board, warned in a Handelsblatt interview.
On oil markets the two main contracts resumed their downtrend after jumping on Tuesday in reaction to the weaker dollar.
US benchmark West Texas Intermediate for March delivery slipped 82 cents to US$45.41. The contract rose US$1.08 Tuesday.
Brent North Sea crude - which jumped US$1.44 in the previous session - shed 75 cents to US$48.85.
Gold fetched US$1,291.50 an ounce, against US$1,280.38 late Tuesday.