Asian markets down on China, Europe worries

HONG KONG: Asian shares were broadly lower Monday as Chinese manufacturing activity slipped, Japanese business confidence fell, and worries persisted over debt-ridden Spain.

In Tokyo the benchmark Nikkei 225 index was down 1.14 percent, Taiwan was off 0.68 percent and Singapore slipped 0.43 percent.

Hong Kong, Shanghai, Seoul and Sydney were all closed for public holidays.

The falls came after official data showed manufacturing activity in China, the world's second-biggest economy, contracted for a second straight month in September.

The government's purchasing managers' index (PMI) stood at 49.8, falling short of expectations. A PMI reading above 50 indicates expansion, while one below points to contraction.

It came after British bank HSBC at the weekend released its own PMI of 47.9, its 11th consecutive month of contraction.

China's economic growth slowed to 7.6 percent in the three months to June, the poorest result since the height of the global financial crisis three years ago.

Beijing has expressed confidence it will achieve its 2012 economic growth target of 7.5 percent, though that would mark a sharp slowdown from 9.3 percent last year and 2010's 10.4 percent.

Lee Kok Joo, head of research at Phillip Securities in Singapore, told Dow Jones Newswires: "The macro picture is still in contraction mode. Investors are still very cautious of going into the market."

In Tokyo, the Bank of Japan said confidence among large manufacturers worsened in the quarter ended September, with businesses suffering from a territorial spat with China over disputed islands in the East China Sea.