Friday, September 24

Asian stocks drop as weak China data rekindle growth woes


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Most shares in Asian emerging markets

fell on Wednesday, as a raft of subdued data from China,

indicating slowing economic activity in the world’s second

largest economy, raised concerns over a global recovery and an

aversion towards riskier assets.

Singapore stocks led losses in the broader region,

dropping 0.8% to hit a two-week low, after the city-state on

Tuesday reported its highest number of COVID-19 cases since

August last year.

A recent rise in cases after relaxation of some COVID-19

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measures has prompted the city-state to pause on further

reopening.

“Given that eventual policy objective is for COVID-19 to be

endemic in society, we expect stronger policy resistance this

time round against going back to lockdowns,” Maybank analysts

said in a note.

China’s factory and retail sectors faltered in August with

output and sales growth hitting one-year lows as fresh

coronavirus outbreaks and supply disruptions threatened the

country’s impressive economic recovery.

“Slowing China activity has a knock-on effect across the

region,” said Mitul Kotecha, chief EM Asia & Europe strategist

at TD Securities.

“This just exacerbates global concerns about weakening

economic activity… that we are past peak growth and moderation

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in activity is now intensifying.”

Separately, China’s Ministry of Housing and Urban-Rural

Development told major banks that cash-strapped real estate

giant Evergrande won’t be able to make loan interest

payments due Sept. 20, Bloomberg News reported, citing people

familiar with the matter.

China shares slipped 0.3%, while Taiwan,

Philippines and Indonesia also fell.

Currencies in the region were largely subdued and traded

sideways against a flat dollar, after softer-than-expected US

inflation data raised doubts about the US Federal Reserve’s

taper timeline.

US data on Tuesday showed that consumer price index rose

less than expected in August. Lower inflation suggests that the

Fed will be under less pressure to begin trimming its vast asset

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purchases soon.

Bucking the trend, South Korean shares gained on

Wednesday, after data showed unemployment rate for August fell

to a record low.

India’s blue-chip NSE Nifty 50 index hit an all-time

high, boosted by gains in energy, automobile and telecom stocks.

HIGHLIGHTS

** Indonesian 10-year benchmark yields up 1 basis point at

6.181%​​

** Jardine Matheson Holdings Ltd, down 2.19%, top

loser on Singapore STI

Asia stock indexes and

currencies at 0708 GMT

COUNTRY FX RIC FX FX INDEX STOCKS STOCK

DAILY YTD% DAILY S YTD

%%%

Japan +0.13 -5.74 -0.52 11.18

China +0.00 +1.40 -0.25 5.19

India +0.05 -0.78 0.51 24.93

Indonesia +0.04 -1.40 -0.28 2.23

Malaysia +0.07 -3.30 -0.09 -4.49

Philippines -0.09 -3.62 -0.58 -3.63

S.Korea +0.03 -7.20 0.15 9.74

Singapore +0.09 -1.60 -0.79 7.46

Taiwan +0.22 +3.01 -0.46 17.79

Thailand +0.21 -8.80 0.26 12.33

(Reporting by Harish Sridharan in Bengaluru; Editing by Rashmi

Aich)

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