Update: Asia: Stocks sink toward 3-year low as China angst fuels rout, STI down 1.5%

[SYDNEY] The global equity selloff showed no signs of abating in Asia, with regional stocks sliding toward an almost three-year low amid a commodity rout fueled by mounting concerns over China. Bonds climbed with the yen as spiking volatility fed demand for haven assets.

The Topix index slid 3 per cent by 9:30 am in Tokyo, set for its lowest close since Feb 3 as materials and health- industry stocks led declines.

Singapore shares sank on opening with the Straits Times Index dow 1.47 per cent at 2,750.88 as of 9:19 am.

China's stocks fell, sending the benchmark index toward its steepest quarterly loss since 2008, as concern about the nation's economy deepened ahead of the start of a week-long National Day holiday that starts on Oct. 1.

The Shanghai Composite Index slid 1.6 per cent to 3,052.56 at 9:31 am local time, extending losses in since its June peak to 41 per cent. Material companies led declines, with Jiangxi Copper Co. slumping 2.2 per cent. Data on Monday showed industrial profits dropping the most in at least four years, while an official manufacturing report scheduled for Thursday will likely a show a contraction.

The Hang Seng index in Hong Kong was down 3.8 per cent, breaching a key support level and its lowest level since July, 2013.

Australia's S&P/ASX 200 Index slumped 2.7 per cent, on track for its biggest one-day rout since the last global selloff in late August. Mining stocks, the second-biggest grouping on the ASX, dropped more than 4 per cent with energy producers. In Wellington, the S&P/NZX 50 Index dropped 1 per cent.

While markets in Hong Kong resume trading Tuesday after a holiday, South Korea is closed until Wednesday. Taiwan will also remain shut as a typhoon lashes the island. Futures on the FTSE China A50 Index were down 1.4 per cent in most recent trading, with mainland Chinese markets to close for a five-day holiday from Thursday.

Markets have been whipsawed throughout the northern summer as anxiety over China's economy, which has been stumbling despite stimulus efforts, bubbles under the surface.

Glencore is the latest victim of the slowdown in Asia's largest economy, with the commodity trader's value cut by about a third amid stock losses on Monday. Amid the turmoil, the Fed has been ramping up its rhetoric in favor of a 2015 rate hike, a move that will likely hit demand for emerging-market investments as their economies struggle.

A 29 per cent slump in Glencore's London-traded stock sent the Bloomberg World Mining Index tumbling to its lowest level in almost seven years Monday. In the US, the Russell 2000 Index of smaller companies reached a fresh low for the year, while the bear market for US biotechnology shares deepened. The S&P 500 has lost 12 per cent from its record high reached in May and is down 8.8 per cent this quarter.

Futures on the Standard & Poor's 500 Index were little changed following a 2.6 per cent slump in the US benchmark Monday. Contracts on the Dow Jones Industrial Average and the Nasdaq 100 Index were also steady, after earlier rising as much as 0.3 per cent."I'm expecting some continued turbulence in the market," John Carey, a fund manager at Pioneer Investment Management Inc. in Boston, which oversees US$244.1 billion globally, told Bloomberg TV. "In the near term, one needs to be careful. The world economy is soft in places and there are risks out there."

BLOOMBERG