Asian stocks dropped on low trading volume as commodity producers followed fall in industrial metals and crude oil. Investors and institutions are in the wait and watch mode ahead of US Fed's meeting in December.

This resulted in low liquidity in the Asian stocks. The surge of US dollar is making commodities expensive for buyers in other currencies. Several commodities stocks fell on thin volumes. Oil, Nickel and gold prices also dropped pushing down Bloomberg's Commodity index to 16- year low.

The US dollar is gaining strength as the probability for interest rate hike by the US Federal Reserve is getting stronger. This is making commodities expensive for buyers, who hold other currencies. The MSCI Asia Pacific barring Japan index fell 0.3 percent to 418.71 in Hong Kong. It rose 2.4 percent during the previous week.

According to reports from Bloomberg, the London Metal Exchange (LME) index, a barometer for six industrial metals, dropped 27 percent this year so far. LME industrial index registered worst annual fall since the global financial crisis in 2008. Volumes in South Korea stock exchange slipped below the 30-day average. Japanese equity markets closed for a public holiday. 

The US stocks witnessed the best week of trading this year so far as the growing optimism about possible interest rate hike by the US Fed has been improving investors' confidence. However, raw materials and energy stocks slipped into pressure as the rising US dollar made them expensive for global buyers. 

Oil prices fell as the US benchmark WTI dropped to $40 a barrel. Nickel and gold prices also fell. Bloomberg's Commodity index eased to 16- year low. Euro also weakened following the statement by European Central Bank's chief Mario Draghi that it may go for another round of stimulus to improve the low inflation in the eurozone.

Commodity stocks including BHP Billiton Ltd, Guotai Junan International Holdings fell 17 percent in Hong Kong. BHP Billiton was the main drag on the index. Guotai Junan stocks tumbled after the media reports stating that it can't contact its Chairman.

The Hong Kong unit of Guotai Junan Securities has appointed officials for time being as it failed to contact its Chairman and CEO Yim Fung since 18 November 2015, according to company's filing to the stock exchange.

Consumer stocks gained momentum while commodity producers suffered steepest declines on Asia-Pacific region. Copper was trading near to its lowest price since 2009. FTSE china A50 index accrued 0.4 percent, according to instaforex.com.

Shanghai composite index marginally fell 0.6 percent and Hong Kong's Hang Seng index dropped 0.4 percent. The IPO process has been resumed in Chinese stock market. China Securities Regulatory Commission has started reworking on five IPOs for listing on Shanghai Stock Exchange and five IPOs on Shenzhen bourse. 

The recovery of markets this month gave a fresh hope on Chinese stock markets that they can withstand the crisis and stand on their own fundamentals. Singapore Straits Times Index fell 0.2 percent.

The Kospi index was marginally up 0.7 percent on thin volume that fell below 30-day average. Australia's S&P/ASX-200 index added 0.4 percent while New Zealand's S&P/NZX-50 index rose 1.2 percent indicating a record high level. Taiwan's Taiex index edged up 0.2 percent.