The slide came after disappointing economic and corporate news renewed worries that the US economy – a key export market for Asia - was sliding into a recession.
On Friday the Dow Jones industrial average fell 2.51 per cent on concerns over the health of the world's number one economy.
Japanese stocks came under further pressure from the dollars slide against the yen, damaging the competitiveness of Japanese exporters.
Exporting companies bore the brunt of the selling with carmaker Honda falling 5.8 per cent, robotics maker Fanuc skidding 8.7 per cent, and TDK Corp. down 6.5 per cent.
|
| Tokyo Nikkei 225 |
-4.5% |
| Hong Kong Hang Seng |
-3.07% |
| Sydney S&P/ASX200 |
-2.98% |
| Seoul KOSPI |
-2.3% | |
Financial shares also took a hammering on signs of continued global weakness in the sector after American International Group announced the worst quarterly loss in its history on Friday due to a write-down of troubled mortgage securities.
That had a knock-on effect on Monday on Japanese financial stocks with Mizuho Financial Group shedding 5 per cent and Mitsubishi UFJ Financial Group falling 4.7 per cent among the losers.
In South Korea Samsung Electronics, the country's biggest corporation, fell 2 per cent, while Steelmaker Posco dropped 3.2 per cent.
South Korea's Kospi, which rose 32 per cent last year, has already lost 12 per cent in the first two months of 2008 amid stock global stock declines stoked by worries over a possible US recession.