Fears the US economy is facing another huge economic crisis spurred a sell-off in Asian markets yesterday as Barack Obama’s re-election raised the spectre of another bitter stand-off in Washington. Investors fear a deeply divided Congress will not be able to reach an agreement to avoid a so-called fiscal cliff at the end of the year that many say will send the US back into recession. Eyes were also on Beijing, where the Communist Party has kicked off its 18th congress, which will see the beginning of a once-in-a-decade leadership change. Tokyo tumbled 1.51%, or 135.74 points, to 8,837.15, Sydney fell 0.72%, or 32.7 points, to close at 4,483.8 and Seoul lost 1.33%, shedding 25.83 points to 1,911.09. Hong Kong skidded 2.41%, or 532.94 points, to 21,566.91 and Shanghai fell 1.63%, or 34.22 points, to 2,071.51. In other markets, Singapore slid 1.02%, or 31.02 points to 3,012.25; Taipei fell 0.61%, or 44.55 points, to 7,242.63; Manila rose 0.17%, or 9.42 points, to 5,446.71; Wellington added 0.31%, or 12.15 points, to 3,955.25; Kuala Lumpur shares ended down 0.27%, or 4.46 points, at 1,641.07; Jakarta fell 0.52%, or 22.56 points, to 4,327.87, while Bangkok shed 0.46%, or 6.04 points, to 1,293.70. The initial upbeat reaction Wednesday to Obama’s victory over Republican Mitt Romney was replaced yesterday with trepidation as the focus turned to the fiscal cliff, a combination of deep spending cuts and huge tax hikes to take effect on January 1. The package is a major threat to the economy after a protracted but possibly reckless compromise was agreed last year between Democrats and Republicans in order to raise the country’s borrowing cap. If it kicks in, the US’ slow recovery from the financial crisis could be reversed and the economy tip back into recession, which would in turn deal a major blow to the global economy. And with Democrats holding the Senate while the Republicans hold the House of Representatives analysts say a compromise could be as tough to find as last August, when the row over the spending limit saw the country lose its AAA sovereign debt rating. “Immediately after the re-election parties ended, markets returned to the daunting issue of the US ‘fiscal cliff’,” Nicholas Smith, Japan strategist for CLSA in Tokyo, told Dow Jones Newswires. Market sentiment was also pressured after the European Union slashed its eurozone economic forecast and European Central Bank chief Mario Draghi warned that the eurozone’s woes were beginning to hurt Germany, the bloc’s powerhouse.