Japan's Nikkei 225 Average sank 4.49 percent, with the Nikkei hitting a nearly six-week closing low as Honda Motor, Sony and other exporters were battered by the strong yen and on growing U.S. recession worries. Shares of Japanese consumer lender Takefuji Corp tumbled 6.6 percent after it said it may post a loss of up to 30 billion yen ($290 million) on a structured finance transaction that has been hit by the global credit crisis.

South Korea's KOSPI finished down 2.3 percent as renewed recession fears in the United States hit exporters such as LG Electronics and financial firms slumped on concerns about more write-downs in the global financial sector. Shares in South Korea's top automakers, however rose. Hyundai Motor and Kia Motors, recovered from early losses on February sales data and hopes for better earnings this year.

Australia's S&P/ASX 200 Index finished 3 percent lower. Financial stocks were hardest hit with Commonwealth Bank and Babcock & Brown down sharply. But resource stocks did well. Zinifex rose 9.2 percent after fellow miner Oxiana launched an agreed A$6 billion ($5.6 billion) takeover offer. Oxiana fell 1.76 percent.

Hong Kong stocks fell more than 3 percent, tracking losses in global equities on concern over weakness in the U.S. economy, with investors looking ahead to a series of major company earnings due this week. But the index will be likely be helped in Tuesday's session. After the close of trading, HSBC released annual results that investors applauded in Europe, with shares climbing to the top of London's FTSE-100. HSBC said pre-tax annual profit rose, as strength in Asia helped it offset bad debts due to housing market problems. The bank also boosted its dividend.

Singapore's Straits Times Index fell 3.3 percent on fears of a looming U.S. recession and more write-downs in the global financial sector. Financials such as top lender DBS Group and Singapore Telecommunications led the decliners.

China's Shanghai Composite Index bucked the trend to finish up more than 2 percent. Chinese stocks climbed, led by large caps such as PetroChina, as the market performed better than many investors had expected with large amounts of new shares becoming freely tradable. China Business News estimated that 371.9 billion yuan ($52.4 billion) of shares would become tradable this month as lock-up period related to IPOs and state share reforms expired, with two-thirds of that amount becoming tradable on Monday.