SYDNEY, NSW, Australia - Stocks across Asia lost ground on Wednesday, although the New Zealand market defied the regional trend by notching up solid gains.

As with the sentiment in other global markets, traders across Asia were blaming fears of a coming recession to rationalise the selling.

"The market moves over the past couple of days have been classic recessionary pricing," Hugh Gimber, global market strategist at J.P. Morgan Asset Management told Reuters Wednesday. "Investors are really becoming more cognisant of the risks."

The U.S. dollar steadied after a day of historic gains.

In Hong Kong, the Hang Seng fell 266.41 points or 1.22 percent to close Wednesday at 21,586.66.

Japan's Nikkei 225 shed 315.82 points or 1.20 percent to 26,107.65.

The Australian All Ordinaries dropped 33.80 points or 0.50 percent to 6,784.30.

The Kospi Composite, in Seoul, South Korea, lost 49.77 points or 2.13 percent to 2,292.01.

China's Shanghai Composite retreated 48.68 points or 1.43 percent to 3,355.35.

Going against the trend, the S&P/NZX 50 in New Zealand advanced 175.90 points or 1.60 percent to 11,141.07.

On foreign exchange markets, the euro was left licking its wounds after a tumultuous fall overnight. The EU unit last traded at 1.0244 around the Sydney close.

The British pound was weak at 1.1958. The Japanese yen strengthened to 135.12. The Swiss franc was unchanged at 0.9690.

The Canadian dollar edged down to 1.3041. The Australian dollar was soggy at 0.6795. The New Zealand dollar had few bidders, last trading at 0.6173.

Overnight on Wall Street, the Dow Jones finished the day with a 129.44 points or 0.42 percent loss at 30,967.82, after being down as much as 700 points earlier.

The Nasdaq Composite gained 194.39 points or 1.75 percent to 11,322.24.

The Standard and Poor's 500 edged up 6.06 points or 0.16 percent to 3,831.39.