Japan's benchmark index fell to its lowest in nearly a year-and-a-half while Hong Kong's stock market sank 1.2 percent and Taiwan's key index tumbled 4.1 percent.

Stocks in China and India bucked the regional trend to climb higher. But investors across much of Asia dumped shares after a sharp drop on Wall Street on Friday following the dismal jobs figures and a rise in the U.S. unemployment rate to 5 percent, fanning concerns about a slowdown in the U.S., a vital export market for Asian companies.

"Today's sell-off was due to concrete evidence that the housing market woes have finally started eroding the U.S. economy," said Masatoshi Sato, senior strategist at Mizuho Investors Securities in Tokyo.

Japan's benchmark Nikkei index lost 190.86 points, or 1.3 percent, to 14,500.55 points, its lowest since July 18, 2006. That follows a 4 percent plunge on Friday, the first day of trading in 2008 in Tokyo.

Decliners included shipbuilder Kawasaki Kisen, which fell 5.8 percent, and Nippon Steel, which shed 2.8 percent.

Sony rose 0.7 percent and Matsushita Electric Industrial added 0.7 percent after U.S. movie studio Warner Bros. said that it will support Sony's Blu-ray format for next-generation DVDs. Matsushita supports the format.

In Hong Kong, the Hang Seng Index dropped 340.2 points, or 1.24 percent, to 27,179.49, paring losses after earlier dropping 3 percent.

"The Hang Seng Index may drop to 26,000 to 26,500 points this week. This provides a good entry point for long-term investors, given the U.S. may cut its interest rate by more than a quarter percentage point later this month," said Dao Heng Securities Ltd.

The three biggest heavyweights on the Hang Seng Index led the decline. HSBC fell 1.8 percent, China Mobile dropped 1 percent and PetroChina ended 2.3 percent lower.

Most property developers returned to positive territory in the afternoon on bargain-hunting. The property subindex rose 1.5 percent. Sino Land rose 2.9 percent, Henderson Land gained 2.4 percent and Sun Hung Kei Properties ended 2.2 percent higher.

On the Chinese mainland, stocks rose as expectations of strong fourth-quarter earnings pushed up banks and property developers despite a central bank statement Friday reiterating its shift to a tight monetary policy stance.

The benchmark Shanghai Composite Index gained 0.6 percent to finish at 5,393.34 points. The Shenzhen Composite Index for China's second, smaller market rose 1.3 percent to 1,528.00.

"The market will likely continue its upward trend in coming sessions, driven by ample liquidity and the absence of negative news," said Essence Securities analyst Zhu Haibin.

Most banks and property developers rebounded after recent sharp falls. Shanghai Pudong Development Bank finished up 5.6 percent while Hua Xia Bank gained 3 percent.

The central bank, the People's Bank of China, on Friday reiterated its switch to a "tight" monetary policy stance in a statement following its annual meeting.

China Railway soared 8.4 percent on weekend news that the company won contracts worth of 21.9 billion yuan for the construction of the Beijing-Shanghai High-Speed Railway.