The dollar fell as much as 1 percent against the Japanese currency to 108.65 yen, its lowest since August 29 after North Korea conducted its sixth and biggest nuclear test two days ago. Hong Kong's Hang Seng index sank 0.9 percent to 27,485.12 and Shanghai Composite Index slipped 0.3 percent to 3,373.05.
Mining stocks were some of the biggest risers, with Fresnillo and Randgold Resources both jumping nearly 3%.
SEOUL, South Korea (AP) - Asian stock markets were lower on Wednesday as investors found ample reasons to stay away from risky assets amid still-high tensions on the Korean Peninsula and the powerful hurricane approaching the United States.
In the previous trading session, USA markets came under sharp pressure as fears surrounding the West's future relationship with North Korea added jitters to market sentiment.
"However, with the increasing regularity of such tests, and the USA's Labor Day holiday, the edge has been taken off the European losses".
Technology companies also fell sharply. The 10-year Treasury yield continued its descent, falling another 10 basis points to 2.07%.
The broad-based S&P 500 also lost 0.4 percent to 2,467.30, while the tech-rich Nasdaq Composite Index dropped 0.5 percent to 6,403.85. Yesterday's wave of optimism has come to an end, and while brokers expect another strong year for Barratt developments, the company lost 3.53 percent during early trading. Nvidia Corp. gave up $4.55, or 2.7 percent, to $165.91. Halliburton Co. added 93 cents, or 2.4 percent, to $39.83.
German bond yields dipped to their lowest levels in more than four months, while the Swiss franc, often regarded among investors as a safer bet in turbulent times, rose 0.7% against the dollar.
Shares in cruise line operators fell as Hurricane Irma roared toward islands in the northeast Caribbean on Tuesday. The contract gained $1.37, or 2.9 percent, to settle at $48.66 a barrel on Tuesday.
The FTSE 100 fell 0.4% to 7,340.19, led by financial and industrials shares.