Asian shares lower on China data, Wall Street losses

Shanghai tumbled 2.00 per cent in the afternoon and Hong Kong fell 1.26 per cent by the break, while Sydney lost 1.05 per cent, or 50.9 points, to end at 4,783.7.

Tokyo ended 1.13 per cent, or 119.79 points, lower at 10,437.31.

Seoul slipped 0.43 percent, or 9.03 points, to 2,106.66 a day after hitting a record high.

China said its consumer inflation stood at 4.6 per cent in December. While that was down from November's 5.1 per cent, the rate over 2010 came to 3.3 per cent, higher than the government's target of three per cent.

The world's second-biggest economy grew at a breakneck 10.3 per cent last year, up from a revised 9.2 per cent in 2009 -- China's fastest annual pace since the global financial crisis began.

The losses in Shanghai and Hong Kong followed strong gains on Wednesday after a leaked report by Hong Kong-based Phoenix Television previewed the inflation and growth figures.

Analysts said the still-high inflation figure in December supported the case for further interest rate hikes and bank lending restrictions, after a slew of measures taken by Beijing over the past year to cool the red-hot economy.

Zheshang Securities analyst Wang Weijun said the "December macroeconomic data has been digested and now eyes will be on January's inflation numbers and whether that will trigger more monetary tightening".

And Zhang Gang, an analyst from China Central Securities, predicted another rate rise -- following similar moves in December and October -- around the Lunar New Year holiday at the start of next month.

Asian trade got off to a poor start after financial shares on Wall Street tumbled. Banking giant Goldman Sachs reported a 52 per cent fall in fourth-quarter profit and a 38 per cent drop over the year.

The Goldman figures compounded fears over the US economy after December housing starts fell to their lowest level since October 2009.

The Dow fell 0.11 per cent, the broad-market S&P 500 lost 1.01 per cent and the tech-rich Nasdaq dropped 1.46 per cent.

Worries about the pace of the US economic recovery could revive, Kenichi Hirano, operating officer at Tachibana Securities in Tokyo, told Dow Jones Newswires.

The housing data "cast a doubt on US consumption this year", Hirano said.

On foreign exchange markets the euro fell against the dollar on profit-taking after it hit a two-month high, dealers said.

The single currency bought $1.3452 in Tokyo morning trade, down from $1.3470 in New York late Wednesday.

The euro had reached $1.3539 on Wednesday, its highest since November 23, on improved confidence in the eurozone after a well-received debt sale by beleaguered Portugal.

Against the Japanese currency the euro edged up to 110.50 yen from 110.47 in New York, while the dollar changed hands at 82.14 yen, compared with 82.20 yen.

New York's main contract, light sweet crude for February delivery, dropped 10 cents to $90.76 a barrel and Brent North Sea crude for March delivery was off 29 cents at $97.87.

Gold opened at $1,367.50-$1,368.50 an ounce in Hong Kong, down from Wednesday's close of $1,374.50-$1,375.50.

In other markets:

-- Taipei fell 0.70 per cent, or 63.85 points, to 9,022.17.

Digital camera and cell phone lens maker Largan Precision Co lost 5.63 percent to Tw$771.0 on worse-than-expected earnings and Taiwan Semiconductor Manufacturing Co closed 2.05 per cent lower at Tw$76.4.

-- Manila closed 0.82 per cent, or 33.32 points, lower at 4,006.24.

Top-traded Aboitiz Power Corp. was down 0.18 per cent at 28.25 pesos and property play Megaworld Corp. slipped 2.33 per cent to 2.10 pesos.

-- Wellington slid 0.20 per cent, or 6.73 points, to 3,339.29.

The losses came after data showed the December quarter inflation rate hit 2.3 per cent, the highest in almost 22 years.

Fletcher Building fell 0.76 per cent to NZ$7.79 New Zealand dollars, Telecom dipped 0.4 per cent to NZ$2.27 and retailer The Warehouse Group ended down 0.02 per cent at NZ$3.62.