Unimpressive Data from China, Japan Weaken Asian Markets

February 28, 2018
Unimpressive Data from China, Japan Weaken Asian Markets

By Investors Hub

Asian stocks followed Wall Street lower on Wednesday after hawkish comments from Federal Reserve Chairman Jerome Powell triggered speculation that the Fed might hike rates four times this year instead of the expected three. Weak economic data from China and Japan also weighed on markets across the region.

China’s Shanghai Composite Index tumbled 32.57 points or 1 percent to 3,259.50, as official data showed the manufacturing PMI for February hit a 19-month low. Hong Kong’s Hang Seng Index plunged 423.94 points or 1.4 percent to 30,844.72.

The manufacturing PMI came in at 50.3, missing forecasts for 51.1 and down from 51.3 in January. The non-manufacturing PMI slowed to 54.4 versus forecasts for 55.0 and down from 55.3 in the previous month.

Japanese shares fell as the Bank of Japan’s decision to trim purchases of super-long government bonds helped to lift the yen and a slew of data releases disappointed investors.

Industrial production in Japan fell at a faster than forecast rate in January and retail sales dropped 1.8 percent month-on-month, while housing starts logged a double-digit decline at the start of the year, separate reports showed.

The Nikkei 225 Index plummeted 321.62 points or 1.4 percent to 22,068.24, while the broader Topix Index closed 1.2 percent lower at 1,768.24. Index heavyweights Fast Retailing, Fanuc and SoftBank all ended down over 2 percent. Oil majors Inpex and Japan Petroleum declined 4-5 percent.

Australian shares fell in reaction to disappointing earnings, falling commodity prices and the overnight sell-off on Wall Street.

The benchmark S&P/ASX 200 Index dropped 40.90 points or 0.7 percent to 6,016, while the broader All Ordinaries Index closed 0.7 percent lower at 6,117.30.

Miners BHP Billiton, South32 and Fortescue Metals Group fell 2-3 percent, and banks Commonwealth, NAB and Westpac ended down between half a percent and 1.2 percent.

Electronics retailer Harvey Norman Holdings slumped 12.5 percent and hospital operator Ramsay Health Care lost 5.8 percent after reporting decreases in their half-year profits.

Cement and masonry supplier Adelaide Brighton plummeted 5.9 percent after its full-year profit was hit by impairments. Bega Cheese retreated 6.4 percent despite the dairy processing firm reporting a 31 percent increase in first-half net profit.

Shares of Retail Food Group, the parent of Donut King, entered a trading halt after delaying its half-year earnings announcement.

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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