Asian markets traded mostly lower on Monday as the firmer yen wiped out demand for Japanese exporters, already under pressure over China and Japan's territorial row over the Diaoyu islands.

The Nikkei 225 index closed down 40 points or 0.45% at 9,069 while the Hang Seng Hong Kong also retreated 40 points or 0.19% to 20,694.

Renewed concerns about the European debt crisis also hurt exporters in Tokyo after disappointing economic reports from Germany and China. Germany's Ifo institute said business confidence in Europe's largest economy unexpectedly fell in September.

Meanwhile a separate report said China's manufacturers and retailers are less optimistic about sales than they were three months ago.

Concern about Europe's debt crisis was also rekindled after Spain's finance minister Luis de Guindos says the country is in no rush to ask for aid.

The safe haven yen was in demand on Monday as the dollar traded at ¥78.02 compared to ¥78.18 on Friday. The euro fell to the lowest in more than a week against the yen.

Toyota fell 1.6%, Honda dragged 1.8% while Nissan dropped 2.8%. Canon was also friendless as it nursed a 4% loss and Panasonic declined 3.3%.

Toyota's losses came despite it reporting that it has resumed all operations in China following violent protests against its operations in the country.

Elsewhere construction machinery makers Hitachi Construction Machinery and Komatsu both fell around 1.5% after US peer Caterpillar reported a slowdown in sales growth for the quarter to the end of August compared to the previous quarter.

Chip maker Renesas Electronics surged 31% after weekend reports said the financially struggling company may receive a bid from a Japanese state-backed consortium to counter a takeover offer from US private-equity firm KKR.

Commodities came under pressure as crude oil futures turned lower again. PetroChina fell 1% in Hong Kong as did China Petroleum & Chemical.



CJ

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