Asian markets slip on weak US manufacturing

HONG KONG: Asian markets slipped further on Wednesday following losses in Europe and on Wall Street after a third straight monthly contraction in US manufacturing activity.

The disappointing US data followed poor numbers on factory activity from Asia and Europe but dealers looked forward to a European Central Bank meeting, optimistic there would be new measures to fight the lingering debt crisis.

Tokyo fell 0.83 percent by the break, Hong Kong lost 1.14 percent, Shanghai shed 0.57 percent and Seoul was off 1.52 percent. Sydney was 0.90 percent lower after figures showed the Australian economy grew slower than expected in April-June.

Regional markets took their cue from Wall Street, which returned Tuesday after a long weekend to figures highlighting the ongoing problems with manufacturing, a key driver of the world's biggest economy.

The Institute for Supply Management said its purchasing managers index stood at 49.6 percent in August, down from 49.8 in July. A reading below 50 indicates contraction. It was the third month of contraction in a row.

Data from the eurozone and Asia on Monday were similarly downbeat. China, a major global growth driver, saw its manufacturing activity fall to its lowest level in more than three years in August.

On Wall Street the Dow fell 0.42 percent and the S&P 500 slipped 0.12 percent but the Nasdaq gained 0.26 percent.

European shares also slipped towards the end of trading after they had spent most of the day in positive territory ahead of Thursday's ECB meeting.

Dealers have broadly upbeat since ECB head Mario Draghi in July hinted at a restart of its sovereign bond-buying programme to help under-pressure eurozone nations suffering high borrowing costs.