Markets in Asia traded in the red as a string of stocks in Tokyo went ex-dividend and as fears continue about Japan's territorial dispute with China.

The benchmark Nikkei 25 fell 184 points at 8,906 in Tokyo while the Hang Seng retreated 170 points at 20,527.

The yen's unrelenting strength added to market unease as the yen traded at ¥77.77 against the dollar.

Toyota, Nissan and Honda Motor were some of the stocks trading ex-dividend which means investors buying their shares today no longer qualify for the mid-term payout.

Honda was also plagued by Honda Deutsche Bank's downgrade on the stock. The German broker reduced its rating on the stock to "hold" from "buy."

Auto stocks also suffered from the ongoing island dispute as key Japanese car firms reduce production in China amid anti-Japan demonstrations and reduced demand for their product in China. In Hong Kong Dongfeng Motor declined 2.2%.

Sentiment was also hurt by a weak close on Wall Street overnight after Federal Reserve Bank of Philadelphia President Charles Plosser slammed the Fed's recent bond buying programme. He said the programme was unlikely to stimulate US economic growth as hoped.

Advantest fell as much as 4.8% as it traded ex-dividend and Fanuc tumbled 3% for the same reason.

Elsewhere construction machinery firm Komatsu dragged 2.8% after the previous day's losses after US giant Caterpillar slashed its earnings outlook at the start of the week. Hitachi Construction Machinery declined 2.6%



CJ

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