Asian markets mostly fell Thursday as dealers followed losses on Wall Street while selling pressure was also stoked by fears over Spain and nervousness ahead of Greek polls at the weekend.
Tokyo fell 0.22 percent, or 19.95 points, to 8,568.89, Sydney closed 0.53 percent, or 21.6 points, lower at 4,042.2 and Hong Kong was 1.15 percent, or 218.12 points, down at 18,808.40.
Shanghai lost 0.99 percent, or 22.97 points, to close at 2,295.95.
However, Seoul gained 0.65 percent, or 12.16 points, to 1,871.48.
With the eurozone's $125 billion loan for Spain's banking sector almost a distant memory, the country has seen its borrowing costs surge to unsustainable levels and traders are growing concerned about its own financial state.
On Wednesday Madrid was dealt another blow when Moody's slashed its credit rating by three notches to just one level above junk status, saying the bailout will add to an already shaky debt position.
Spanish 10-year government bond yields -- the rate of return earned by investors -- spiked at a new record of 6.878 percent in early European trade Thursday, the highest since the eurozone was founded.
Anything above 6.0 percent is considered too high to continue servicing its debts for the medium term and point to investors' concerns about Spain's future as unemployment sits at record highs and public debt rockets.
Eyes are also on Sunday's elections in Greece -- its second in six weeks -- with dealers fearing a victory for anti-austerity parties that could lead to Athens tearing up a bailout deal, which in turn would likely lead it to exit the eurozone.
French President Francois Hollande said in an interview with Greek Mega Channel television that if it appears from the vote that they do not want to respect the bailout deal "there will be countries in the eurozone which would prefer to end Greece's presence in the eurozone."
In a transcript of the interview provided by his office he added that "the abandoning pure and simple of the (bailout and austerity) memorandum would be seen by many eurozone members as a break up".
The euro bought $1.2581 in late trade, up from $1.2556 in New York late Wednesday. The common currency was fetching 99.90 yen against 99.78 yen. The dollar was at 79.40 yen against 79.46 yen.
On Wall Street the major indexes fell on the European concerns as well as weak domestic figures.
The Dow closed down 0.62 percent, the S&P 500 lost 0.70 percent and the Nasdaq slipped 0.86 percent.
Traders went into selling mode after May retail sales fell 0.2 percent from April, and excluding autos shed a heftier 0.4 percent, the Commerce Department reported.
On oil markets New York's main contract, light sweet crude for delivery in July, was up 23 cents at $82.85 a barrel and Brent North Sea crude for July delivery fell 18 cents to $96.95 in late afternoon.
Gold was worth $1,620.75 an ounce at 0820 GMT, compared with $1,609.60 late Wednesday.
In other markets:
-- Taipei fell 0.19 percent, or 13.73 points, to 7,075.10.
Taiwan Semiconductor Manufacturing Co. lost 1.0 percent at Tw$79.2 while Hon Hai Precision edged down 0.12 percent to Tw$82.1
-- Manila ended 1.74 percent, or 88.76 points, lower at 5,020.85.
Philippine Long Distance Telephone gave up 3.69 percent to close at 2,350 pesos and Globe Telecom retreated 6.5 percent to 1,020 pesos.
-- Wellington ended 1.02 percent, or 34.36 points, higher at 3,416.09.
Fletcher Building was up 0.33 percent at NZ$6.15, Telecom rose 3.0 percent to NZ$2.40 and Contact Energy was up 1.5 percent at NZ$4.66.
