Asian Shares Decline On Concerns About Economic Outlook
Asian stocks retreated on Thursday, with concerns of a wider conflict in the Middle East, rallying oil prices and a continued surge in bond yields weighing on sentiment.
Chinese markets fell sharply after the U.S. tightened restrictions on China’s semiconductor industry and troubled property developer Country Garden missed a US$15 million coupon repayment.
The benchmark Shanghai Composite Index tumbled 1.7 percent to 3,005.39, while Hong Kong’s Hang Seng Index ended 2.5 percent lower at 17,295.89.
Japanese markets slumped on hawkish Fed bets and mounting Middle East tensions. The Nikkei 225 Index plunged 1.9 percent to 31,430.62, while the broader Topix Index settled 1.4 percent lower at 2,264.16.
Tech stocks such as Advantest, Tokyo Electron and Screen Holdings lost 3-6 percent after a spike in long-term Treasury yields to 16-year peaks.
Automakers Toyota, Honda Motor and Nissan Motor fell 1-3 percent, while rail operators Keio Corp. and Odakyu Electric Railway both rose about 2 percent.
The yen rose slightly as data showed Japanese exports rose more than expected in September and the trade balance swung to a surplus of 62.4 trillion yen ($410 billion).
Earlier today, Japan’s top currency diplomat Masato Kanda said that authorities can act on excessive moves in currency markets.
Seoul stocks lost ground as the Bank of Korea left its key interest rate unchanged but acknowledged increased inflation risks due to global oil prices and the Israel-Hamas conflict. The Kospi fell 1.9 percent to 2,415.80.
Australian markets succumbed to selling pressure as Middle East tensions simmered and employment data came in weaker than expected in September, potentially easing pressure on the Reserve Bank to raise interest rates next month.
The benchmark S&P ASX 200 Index dropped 1.4 percent to 6,981.60, while the broader All Ordinaries Index slumped 1.3 percent to 7,172.70.
Qantas Airways fell 2.5 percent after it scrapped plans to acquire local charter operator Alliance Aviation Services following opposition from Australia’s competition regulator.
Across the Tasman, New Zealand’s benchmark S&P NZX-50 Index ended 0.8 percent lower at 11,135.58.
U.S. stocks tumbled overnight as a combination of rising Middle East tensions, rallying oil prices and higher bond yields dented investors’ appetite for risk.
A string of upbeat earnings reports and data showing a sharp rebound in housing starts failed to lift sentiment.
The Dow dropped 1 percent, the S&P 500 slumped 1.3 percent and the tech-heavy Nasdaq Composite plummeted 1.6 percent.
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