Yen Hurts Japan's Exporters

SINGAPORE -- Asian stock markets were broadly lower on Monday with exporter shares dragged down in Tokyo by a stronger yen.

Overall sentiment was cautious with base metals and crude oil prices dropping and investors buying the safe-haven U.S. dollar.

"Market timing is essential for investors still concerned about a correction in growth trends, which would lead to an adjustment in pricing of risk," said analysts at UBS.

Japan's Nikkei 225 was down 2.5%, Australia's S&P/ASX 200 down 1.2% and South Korea's Kospi Composite was off 0.8%. Hong Kong's Hang Seng Index was down 0.9% while China's Shanghai Composite index was up 0.3%.

Dow Jones Industrial Average futures were 84 points lower in screen trade.

Some traders were citing a general atmosphere of concern about escalating trade tensions between China and the U.S. On Sunday, Beijing singled out U.S. automotive and poultry product imports for investigation after the Obama administration decided to put steep import duties on Chinese tires.

"Any trade-related dispute and sanction between the U.S. and China, the two most important countries in the global economy, could carry significant implications," said Morgan Stanley China economist Qing Wang.

Elsewhere, Taiwan's Taiex index was down 0.5%, Singapore's Straits Times Index was down 1.2%, Malaysia's headline index was off 0.1%, Indonesian shares were down 1.1%, Philippines down 1.9%, Thailand down 0.6%. New Zealand's NZX-50 was flat.

Japanese exporters dragged the Nikkei lower with Honda Motor down 2.8%, Sony Corp. off 2.8% and Canon 3.6% lower.

SMBC Friend Securities strategist Fumiyuki Nakanishi said the dollar-yen rate and the performance of exporters would likely determine the Nikkei's direction this week, putting support for the index at 10150. But "if the pair drops below 90, selling could accelerate and could bring the Nikkei below 10000."