"Asia Stocks Weaken on China Deflation Risk and Bank Jitters"

Asian shares weakened slightly as China slipped into deflation in July, raising concerns about the global economic growth outlook. European futures rose after Italy announced that its new tax on banks would not exceed 0.1% of total assets. US bank shares fell following Moody's downgrades, while longer-term Treasury yields slipped. The Italian government's decision to impose a 40% tax on bank profits from higher interest rates rattled regional banking shares. Oil prices and the US dollar experienced slight declines, while gold prices rose.