Asian stocks hit three-week lows on Wednesday, as Fed rate-hike worries, Alco's disappointing quarterly results, deepening Samsung's woes over Galaxy Note 7 and apprehensions about OPEC's ability to hammer out an output deal sapped investors' appetite for risk.
While oil prices inched up in Asian deals, the dollar hit an 11-week high ahead of the publication of minutes from the Fed's September meeting later in the day. The pound stabilized after recording its worst four-day performance since the Brexit vote on Tuesday amid concerns over the prospect of a "hard Brexit."
Chinese shares edged lower on currency woes after the country's central bank weakened the reference rate of the yuan for the sixth day in a row.
The yuan briefly hit a fresh six-year low amid signs of increasing volatility in global markets, as investors fret about the long-term consequences of Brexit, a possible Fed rate hike in December and the outcome of upcoming U.S. presidential elections.
The benchmark Shanghai Composite index eased 6.75 points or 0.22 percent to 3,058.50 while Hong Kong's Hang Seng index was down 142 points or 0.60 percent at 23,407, extending losses for the third consecutive session.
Japanese shares fell on profit taking after hitting a five-week high in the previous session. The Nikkei average dropped 184.76 points or 1.09 percent to 16,840 while the broader Topix index closed 1.03 percent lower at 1,342.35. The yen held flat against the dollar after official data showed Japan's core machinery orders fell much less than expected in August.
Exporters closed mostly lower, with Canon, Honda Motor, Nissan, Panasonic, Sony, Toyota and Mazda declining between 0.7 percent and 1.6 percent. Among the worst hit, Softbank, Dainippon Screen Manufacturing, Kobe Steel, Nippon Steel & Sumitomo Metal, Advantest and TDK lost 3-5 percent.
Australian shares closed marginally lower, with miners and energy stocks succumbing to selling pressure as the dollar bull-run sent commodities lower and dragged the Aussie dollar to a three-week low. Investors ignored the Westpac-Melbourne Institute survey, which showed that a measure of consumer sentiment rose for a third month in October.
The benchmark S&P/ASX 200 index inched down 5.20 points or 0.09 percent to 5,474.60 and the broader All Ordinaries index closed down 7 points or 0.13 percent at 5,555.20. BHP Billiton, Fortescue Metals Group, South32, Santos, Oil Search and Origin Energy dropped 2-3 percent. Tabcorp Holdings rallied 2.8 percent after the Australian state of New South Wales reversed a ban on greyhound racing.
Telecommunications firm Vocus Communications fell 2.5 percent after a failed proposal to oust chief executive Geoff Horth and shake-up the board. Law firm Slater & Gordon, which is facing a $250 million class action for wrongdoing, lost 8.3 percent.
Seoul shares closed a tad higher on institutional buying. The benchmark Kospi rose by 1.80 points or 0.09 percent to 2,033.73 even as Samsung Electronics shares remained under selling pressure on worries that its recall of one of its most advanced smartphones could cost the company as much as $17 billion. Samsung shares dropped 0.7 percent after losing as much as 8 percent in the previous session.
New Zealand shares followed regional markets lower, with the benchmark S&P/NZX 50 index closing 16.77 points or 0.24 percent lower at 7,107.46 on fears of a Fed rate hike and amid a subdued start of the U.S. earnings season. Xero led the decliners to end 2.8 percent lower at $18.17, while Meridian Energy rallied 2.5 percent.
Elsewhere, Singapore's Straits Times index was tumbling 1.2 percent, Indonesia's Jakarta Composite index was declining 0.2 percent and Malaysia's KLSE Composite index was down 0.1 percent while the Taiwan Weighted gained 0.4 percent. Indian markets were closed for a public holiday.
Overnight, U.S. stocks fell by the most in nearly a month as oil prices retreated, Alcoa's quarterly results missed estimates and Fed rate hike expectations pushed up the dollar as well as Treasury yields. The Dow dropped 1.1 percent, the tech-heavy Nasdaq fell 1.5 percent and the S&P 500 lost 1.2 percent.
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