Markets roiled by Nikkei’s 7.3 percent slide

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The Shanghai Composite Index lost 1.2 percent to 2275.67, its biggest fall in a month while the smaller Shenzhen Composite Index shed 0.7 percent to close at 1014.47.

Elsewhere, Hong Kong’s Hang Seng slumped 2.5 percent to 22,669.68. South Korea’s Kospi lost 1.2 percent to 1,969.19. Australia’s S&P/ASX 200 dropped 2 percent to 5,062.40.

There were big moves across a range of financial assets. In the currency markets, the yen was the main mover following the rise in Japanese yields. The yen has bounced back strongly, after falling to near five-year lows against the dollar on Wednesday. The dollar was trading 1.7 percent lower at 101.39 yen, having earlier fallen to a low of 100.86 yen.

Oil prices were under the kosh too amid concerns over the global growth environment — the benchmark New York rate was down $1.19 at $93.09 a barrel. Gold, however, was in demand as it benefited from its status as a haven at a time of uncertainty. It was up 1.3 percent at $1,385 an ounce.

The main debate now in the markets is whether Thursday's developments mark the end of the euphoria that has gripped many investors this year.

Reaction to upcoming U.S. economic data and comments from officials at the Fed will provide insights into whether the bull run has come to an end. Later, traders will have U.S. new home sales figures to digest — the recent improvement in housing indicators has been largely behind the speculation of a change of course by the Fed.

“A solid performance here will simply add to the hawkish sounds that are going to resonate from the Fed and in turn could end up weighing further on the major indices,” said Fawad Razaqzada, market strategist at GFT Markets.

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Sampson contributed from Bangkok.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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