HONG KONG — Asian stock markets sank in erratic trade Tuesday as investors waited to see how the U.S. will boost its economy with a massive stimulus package and reshape its program to bail out banks.
Markets across the region were largely directionless after solid gains last week on hopes the U.S. stimulus measures will speed recovery in the world's largest economy. An $838 billion economic stimulus bill survived a key test vote in the Senate Monday, setting up a final vote Tuesday.
Investors also are anticipating more details about how the Obama administration plans to retool the government's $700 billion program to bail out financial institutions reeling from bad assets. Later Tuesday, Treasury Secretary Timothy Geithner is to unveil new rules for the program, which has been heavily criticized for doling out hundreds of billions of dollars to banks with few conditions on how the money is spent.
"People are waiting to see what happens in the U.S.," said Conita Hung, head of equity markets with Delta Asia Financial Group in Hong Kong. "People aren't going to inject a lot more money in the market with this kind of uncertainty."
Japan's Nikkei 225 stock average was down 35.21 points, or 0.4 percent, at 7,933.82, Hong Kong's Hang Seng lost 51.56 points, or 0.4 percent, to 13,717.50 and South Korea's Kospi was off 6.26 points, or 0.5 percent, at 1,196.43. All three markets earlier had fluctuated in and out of positive territory.
In mainland China, Shanghai's key index — which had surged about 12 percent over the last six trading days — declined 0.8 percent even as figures showed the country's inflation eased to just 1 percent in January. That's seen as giving Beijing more leeway to carry out its own economic stimulus plan without igniting new price rises.
Benchmarks in Australia and Singapore also fell, while those in Taiwan and India gained modestly.
Asian trade matched a listless session in the U.S., where markets wavered ahead of announcements from Washington.
The Dow Jones industrial average fell 9.72, or 0.12 percent, to 8,270.87. The blue chips fluctuated between gains and losses 49 times during the session. The Standard & Poor's 500 index rose 1.29, or 0.15 percent, to 869.89.
After the market's close, President Barack Obama pressed his case for a stimulus package, warning that failing to act swiftly and boldly "could turn a crisis into a catastrophe."
After he spoke, Dow Jones industrial futures were down 103 points, or 1.25 percent, at 8,115. Standard & Poor's 500 futures were down 13.2, or 1.5 percent, at 851.9.
Oil prices edged higher, with light, sweet crude for March delivery up 35 cents to $39.91 a barrel in Asian trade on the New York Mercantile Exchange. The contract fell 61 cents overnight to settle at $39.56.
In currencies, the dollar weakened to 91.29 yen, compared to 91.36 yen. The euro tumbled to $1.2818 from $1.2974.