Asian Stocks End Lower; Nikkei Falls 2.9%

Japan's Nikkei 225 stock average shed 2.9% to 9,752.88 even as the central bank said the country's economic conditions "have begun to stop worsening" -- an improvement from its previous assessment that the economy had been "deteriorating." The Bank of Japan also left its key lending rate unchanged at 0.1% as expected.

Hong Kong's Hang Seng, meanwhile, ended lower by 1.8%, and South Korea's Kospi dropped 0.9%. Australia's index lost 1.7%.

Oil's decline hit commodity stocks with Chinese offshore oil producer CNOOC(CEO Quote) plunging in Hong Kong and BHP Billiton(BHP Quote), the world's biggest mining company, off 1.5% in Sydney trading.

Benchmark crude for July delivery fell 1 cent to $70.61 a barrel in Asia trading, taking a breather from a three-month rally that has doubled the price of oil. Last week, it rose above $73.

Automakers were hit by the U.S. evidence that manufacturing continues to wilt amid anemic consumer demand. Toyota Motor, the world's biggest automaker, fell 3.4%, and Honda (HMC Quote) retreated 4.1%.

In the U.S. on Monday, the Dow tumbled 187.13, or 2.1%, to 8,612.13, returning to a loss for the year. The broader S&P 500 index dropped 2.4% to 923.72, and the Nasdaq composite index sank 2.3%, to 1,816.38.

U.S. stock index futures pointed to modest declines Tuesday on Wall Street.

In currencies, the dollar's recent strength faded, falling to 96.45 yen from 97.63 yen. The euro rose to $1.3858 from 1.3776.