China economy concerns drag Asian markets lower
Dow Jones Newswires/Singapore
A broad decline in banking stocks dragged most Asian markets yesterday, with concerns about China’s economy adding to selling pressure in Shanghai and Hong Kong.
The day’s trading was again marked by volatility. Analysts are divided on the direction of markets, given signs of economic recovery combined with weak earnings outlooks from several companies. Investors are also wary ahead of the outcome of stress tests on US banks, expected May 4.
“The market’s becoming very polarised,” said BBY senior trader Peter Copeland in Australia. “There are entrenched bears that think this (rally) is all just smoke and mirrors, and there are bulls who think the bears are wedded to their view in the face of recovery signs.”
In Japan, the Nikkei 225 Average ended up 0.2% and the broader Topix Index slipped 0.1%, after fluctuating in a range around the break-even level.
Australia’s S&P/ASX 200 fell 0.3% and New Zealand’s NZX 50 ended 0.1% lower, while Taiwan’s Taiex gained 0.1%. Singapore’s Straits Times gave up 2.3%.
Chinese stocks fell more sharply, dragging the Shanghai Composite Index down 2.9% and Hong Kong’s Hang Seng China Enterprises Index down 3.5%. The benchmark Hang Seng Index fell 2.7% to 14,878.45 in Hong Kong.
Financial sector shares mostly extended losses, with China Construction Bank losing 5.9% in Hong Kong and 1.1% in Shanghai.
“Since China announced the first-quarter economic figures, the [Shanghai] market has seen profit-taking because the 6.1% growth wasn’t exciting,” said Andrew To, sales director at Taifook Research.
“The GDP figure means that the government may have a hard time to maintain the economic growth target [of 8%] this year. Investors are worried that the Shanghai market may have shown some over-excitement, and expect some sharp pullback,” he said.
Dow Jones Newswires/Singapore
A broad decline in banking stocks dragged most Asian markets yesterday, with concerns about China’s economy adding to selling pressure in Shanghai and Hong Kong.
The day’s trading was again marked by volatility. Analysts are divided on the direction of markets, given signs of economic recovery combined with weak earnings outlooks from several companies. Investors are also wary ahead of the outcome of stress tests on US banks, expected May 4.
“The market’s becoming very polarised,” said BBY senior trader Peter Copeland in Australia. “There are entrenched bears that think this (rally) is all just smoke and mirrors, and there are bulls who think the bears are wedded to their view in the face of recovery signs.”
In Japan, the Nikkei 225 Average ended up 0.2% and the broader Topix Index slipped 0.1%, after fluctuating in a range around the break-even level.
Australia’s S&P/ASX 200 fell 0.3% and New Zealand’s NZX 50 ended 0.1% lower, while Taiwan’s Taiex gained 0.1%. Singapore’s Straits Times gave up 2.3%.
Chinese stocks fell more sharply, dragging the Shanghai Composite Index down 2.9% and Hong Kong’s Hang Seng China Enterprises Index down 3.5%. The benchmark Hang Seng Index fell 2.7% to 14,878.45 in Hong Kong.
Financial sector shares mostly extended losses, with China Construction Bank losing 5.9% in Hong Kong and 1.1% in Shanghai.
“Since China announced the first-quarter economic figures, the [Shanghai] market has seen profit-taking because the 6.1% growth wasn’t exciting,” said Andrew To, sales director at Taifook Research.
“The GDP figure means that the government may have a hard time to maintain the economic growth target [of 8%] this year. Investors are worried that the Shanghai market may have shown some over-excitement, and expect some sharp pullback,” he said.
