U.S. stocks suffer worst drop since June after weaker-than-expected dataUpdated: 2014-02-04 22:04:45 KST
Fresh concerns about the strength of the global economy on the back of weaker-than-expected data out of the United States and China, sent stocks tumbling on Tuesday.
Taking a cue from overnight losses on Wall Street, the Korean KOSPI closed below the 19-hundred mark, falling one.seven percent to 18-hundred-86.
Japan's Nikkei 225 closed at its lowest level in three months, falling by over four-percent, while MSCI's broadest index of Asia-Pacific shares outside of Japan fell one.four percent.
U.S. stocks suffered their worst drop since June on Monday, with the Dow Jones Industrial Average tumbling 3-hundred-26 points, or 2.1 percent, to 15,3-hundred-72.
The S&P 500 and the Nasdaq slumped 2.3 and 2.6 percent, respectively.
Monday's selloff was sparked by data that showed new order growth in the U.S. manufacturing sector in January plunged by the most in 33 years, while spending on new construction projects barely rose from December.
Experts say the U.S. economy has hit a soft patch.
"we do know through the latter part of 2013, businesses seemed to ramp up their inventories, perhaps a little bit more than they wanted to."
Stocks were also pressured by concern over China's economy, which saw service-sector growth in January stutter to a five-year low.
And this is shaking the confidence of investors, who have their feet deep in U.S. stocks.
"Most investors have about 80 percent of their equities in U.S. equities and they also have anywhere from 60 to 80 percent of their portfolio in stock, which is far too concentrated."
With the U.S. Federal Reserve expected to further taper its massive stimulus program over the coming months, it looks like the market uncertainty is here to stay -- at least for the time being.
Yoo Li-an, Arirang News.
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