Trade Tensions Weaken Asian Stocks

May 30, 2019
Trade Tensions Weaken Asian Stocks

By Investors Hub

Asian stocks ended broadly lower on Thursday, tracking overnight declines in the U.S. and European markets as investors fretted about trade tensions, slowing global growth and uncertainty over Britain’s departure from the European Union.

Chinese shares fell after a senior Chinese diplomat said that provoking trade disputes is “naked economic terrorism,” ramping up the rhetoric against Washington.

The benchmark Shanghai Composite Index eased 8.89 points or 0.3 percent to 2,905.81 while Hong Kong’s Hang Seng Index ended down 120.83 points or 0.4 percent at 27,114.88.

Japanese shares hit a 3-1/2-month low as trade war fears continued to weigh on sentiment. The Nikkei 225 Index dropped 60.84 points or 0.3 percent to 20,942.53, its lowest level since mid-February. The broader Topix closed 0.3 percent lower at 1,531.98, its lowest closing level since January 11.

Investors offloaded defensive shares, with Astellas Pharma, Kikkoman and Kagome all falling over 4 percent. Fast Retailing declined 1.6 percent and Softbank Group gave up 1.3 percent, while Fanuc advanced 1.7 percent.

Australian stocks followed their global peers lower as renewed concerns over the U.S.-China trade war pulled down commodity prices. Also weighing on sentiment, Fitch Ratings said that Australia’s GDP growth will slow to a decade low in 2019.

The benchmark S&P/ASX 200 Index slid 47.90 points or 0.7 percent to 6,392.10, while the broader All Ordinaries Index ended down 47.40 points or 0.7 percent at 6,489.20.

Miners BHP, Rio Tinto and Fortescue Metals Group tumbled 2-4 percent, and energy stocks such as Santos, Origin Energy and Woodside Petroleum dropped 1-2 percent.

In economic news, Australia’s building approvals declined by seasonally adjusted 4.7 percent sequentially in April, official data showed. Economists expected approvals to remain flat for the month.

Another report showed that the country’s private capital expenditure declined 1.7 percent in the March quarter from the previous quarter, confounding expectations for an increase of 0.4 percent.

Meanwhile, Seoul stocks closed notably higher as foreign investors snapped their four-day selling spree. The benchmark Kospi climbed 15.48 points or 0.8 percent to 2,038.80. Both Samsung Electronics and LG Electronics rose around 1.8 percent.

Modupe Gbadeyanka

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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