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Global turbulence hits Asian stocks

Asian stock markets have fallen after Spain, the fourth-largest euro economy, was slapped with a credit downgrade and the US earnings season opened with a whimper.

Standard & Poor's downgraded Spain's debt from BBB+ to BBB-, the lowest investment-grade level.

S&P said the action was due to the country's recession, high unemployment and social unrest, which limit the government's options for reversing the country's financial crisis.

Meanwhile, aluminium giant Alcoa marked the unofficial start to US corporate earnings season by beating earnings estimates - but investors were disappointed that the company cut its demand forecast for the year, mostly due to a slowdown in China.

In another sign of a worsening global slowdown, South Korea's central bank cut its benchmark interest rate and lowered economic growth forecasts for this year and next.

The turbulence from abroad dragged Asian stocks lower. Japan's Nikkei 225 index fell 0.2% to 8,579.68, and South Korea's Kospi shed 0.2% to 1,944.79, while Australia's S&P/ASX 200 lost 0.2% to 4,483.60.

Hong Kong's Hang Seng, however, rose 0.3% to 20,979.44. The Philippine benchmark also rose.

The turmoil came after Wall Street stocks fell on Wednesday. The Dow Jones industrial average fell 1% to 13,344.97, the Standard & Poor's 500 index lost 0.6% to 1,432.56, and the Nasdaq composite index dropped 0.4% to 3,051.78.

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