Asian stocks fall after US reports

Asian stock markets fell today as strong US company earnings failed to calm investor nerves in the face of economic reports that suggest the world's number one economy is struggling to maintain its recovery.

Tokyo's Nikkei 225 index dropped 0.4% to 9,548.14, a day after Japan reported a record annual trade deficit resulting from huge imports of oil and gas in the wake of an earthquake and tsunami last year that forced nearly all of Japan's nuclear power reactors off-line.

Hong Kong's Hang Seng shed 0.3% to 20,927.64 and South Korea's Kospi lost 1.3% to 1,973.47.

In the US, strong corporate earnings from Morgan Stanley, eBay, Southwest Airlines and Bank of America were not enough to make up for weak reports on jobs, housing and manufacturing.

The Labour Department said weekly applications for unemployment benefits were down 2,000 to 386,000 but anything above 375,000 is generally taken as a sign that hiring is not strong enough to lower the unemployment rate.

Sales of previously owned homes fell 2.6% in March to a seasonally adjusted annual rate of 4.48 million.

In healthier markets, sales typically are closer to six million. The Philadelphia Federal Reserve Bank said that manufacturing output in the mid-Atlantic region slowed a bit from the previous month.

The Dow Jones industrial average fell 0.5% to close at 12,964.10.

The broader Standard & Poor's 500 index dropped 0.6% to 1,376.92. The Nasdaq composite fell 0.8% to 3,007.56.