Asian stocks fall on weak economic lookout

Asian markets slumped on Wednesday as traders turned their attention after the US debt deal to the weakening global economic outlook and fears of fresh sovereign debt contagion in the eurozone.Despite President Barack Obama signing off on the deal to raise the US debt ceiling and avoid a devastating default, equities suffered a heavy sell-off and investors put their cash in safe haven gold, which surged to a record high.Tokyo dived 2.06 percent in the afternoon, Hong Kong fell 1.90 percent by the break and Sydney tumbled 2.08 percent while Seoul was 2.76 percent off.Shanghai was flat.The red numbers in Asia followed similar losses on Wall Street, where markets fell for an eighth straight day, the longest losing streak since the beginning of the financial crisis in October 2008.The Dow sank 2.19 percent, the S&P 500 dropped 2.56 percent and the tech-heavy Nasdaq shed 2.75 percent.The Nasdaq and S&P 500 both closed below where they started the year, while the Dow is at its lowest since mid-March.Investors were unmoved by news that Moodys Investors Service affirmed the USs Aaa rating after the 11th-hour deal to avert a default by Washington.As US default fears lifted, attention turned to the economic outlook. And traders were spooked, with a report showing US consumer spending declined in June, the first drop in nearly two years, suggesting the economy is stalling.That followed results showing manufacturing virtually stalled in the US as well as across Europe and Asia.However, bond markets were roiled by troubles in the eurozone.In overnight trade, concern was focused on Italy and Spain with spreads between yields on their sovereign bonds and those of Germany hitting record levels, dampening hopes that the eurozone debt crisis might soon be over.The premium demanded for buying Spanish 10-year bonds over safe-bet German bonds surged to more than four percentage points -- 404 basis points -- the highest since the introduction of the euro in 1999.