U.S. retail sales suffered their steepest drop on record last month and output at factories declined by the most since 1946 - reinforcing fears that the economy contracted in the first quarter at its sharpest pace in decades.
Moreover, Asia's economic growth this year will grind to a halt for the first time in 60 years, the International Monetary Fund said on Thursday, as exporters are hit by declining demand amid lockdowns throughout the region.
Though softer data from the U.S. on the retail sales on the industrial and retail fronts had been expected, the depth of the disappointment shocked markets, according to a note by Jingyi Pan, a market strategist at brokerage IG.
Leading the fall, the Philippine index slumped up to 4.3% in early trade. Heavyweight conglomerates Ayala Land and SM Investments shed 6.9% and 3.6%, respectively.
The benchmark's steep fall was due to profit-taking and tracking of U.S. markets, according to Ruben Carlo O. Asuncion, chief economist at The Union Bank of the Philippines.
Indonesian stocks shed as much as 2%, with financials weighing on the index. PT Bank Central Asia Tbk slipped 2% while PT Bank Mandiri (Persero) Tbk lost 5.7%.
An overnight slump in oil prices pushed the energy-heavy Thai index more than 1% lower. PTT and PTT Exploration and Production lost around 3%, each.
Shares in Vietnam fell as much as 0.8%, with losses led by financials. Joint Stock Commercial Bank for Foreign Trade of Vietnam skid 1.6%.
Malaysian equities slipped as much as 0.7%, while Singaporean stocks were slightly lower.
(Reporting by Arundhati Dutta; Editing by Ramakrishnan M.)
By Arundhati Dutta