Asian shares tumble as worries about the US economy weigh on tech stocks

(Bloomberg) — Asian stocks tumbled at the start of the new week, weighed down by losses in tech stocks on concerns about U.S. economic growth.

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The MSCI Asia Pacific index fell as much as 1.8 percent to its lowest level in three weeks, chipmakers Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. among the biggest obstacles. Japan’s Nikkei 225 Stock Average fell more than 3 percent before paring losses as the yen pared last week’s sharp gain. Taiwan’s key share gauge fell 2 percent, while Hong Kong’s benchmarks were poised for a fifth straight day of losses.

Weak U.S. nonfarm payrolls data fueled concerns Friday that the Federal Reserve is moving too slowly to support the world’s largest economy. As investors try to gauge the size of the Fed’s interest rate cut next week, the Bank of Japan’s recent move to tighten policy has put upward pressure on the nation’s currency, fueling concerns about carryover transactions.

There is room for “shorter short-term downside to risk assets as positions are likely to unwind,” said Matthew Haupt, portfolio manager at Wilson Asset Management International. “Expect most of the weakness in Japan at this stage, all markets to suffer as well,” he said.

Chinese shares fell as weak output and consumer price data on Monday pointed to continued deflationary pressures. The country’s shares have seen a series of downgrades recently as weak economic data cast doubt on its 5% GDP growth target for 2024.

Sectors to watch

• Chinese medical equipment stocks advanced after authorities said they would allow more foreign investment in the sector to revive economic growth.

• Asian luxury stocks are falling as their European counterparts struggle due to the deepening recession in China.

• Shares of Chinese property developers fall after China Vanke reported that the sales slump worsened in August.

Markets at a glance

• MSCI Asia Pacific index down 1.6%

• Japan’s Topix index fell 1.7%; Japan’s Nikkei fell 1.8%

• China’s CSI 300 index fell 1.1%; Hong Kong’s Hang Seng Index fell 1.9%; Hong Kong’s Hang Seng China Enterprises Index fell 2.2%

• Taiwan’s Taiex index fell 2%

• South Korea’s Kospi fell 0.7%; South Korea’s Kospi 200 index fell 1.1%

• Australia’s S&P/ASX 200 fell 0.6%; New Zealand’s crude S&P/NZX 50 index fell 0.4%

• India’s NSE Nifty 50 index fell 0.1%

• Singapore’s Straits Times Index rose 0.9%; Malaysia’s KLCI rose 0.3%; The Philippines’ PSEI rose 0.7%; Indonesia’s JCI Index fell 0.5%; Thailand’s SET Index fell 0.4%; Vietnam’s VN Index down 0.5%

• The 10-year Treasury yield rose 3.2 basis points

• Bloomberg dollar index up 0.1%

• West Texas Intermediate crude rose 1.3 percent to $69 a barrel

• The Euro was little changed

The story continues

Here are the most notable movers

• Samsung Electronics shares fell as much as 3.3 percent after firms including KB Securities and CLSA downgraded their price targets amid weaker demand for new technology products.

• Akeso shares rose as much as 14 percent in Hong Kong, their highest since May 31, after the company presented the latest data on its lung cancer drug developed in partnership with Summit Therapeutics.

• Hong Kong-listed Nio shares rose as much as 17% in their first trading session on Monday after the Chinese electric vehicle maker’s upbeat second-quarter results. The company is expected to achieve positive free cash flow in the fourth quarter of this year, Citigroup said, citing a call with management.

• Shares in China Renaissance plunge 72 percent in Hong Kong as trading resumes after more than a year of suspension.

• Shares of Guzman y Gomez rose as much as 7.8 percent, bucking general market weakness, after S&P Dow Jones Indices said the stock would be added to the index in its quarterly review.

Market related news

• The takeaway: Weakness in Chinese stocks is eroding the confidence of some of Wall Street’s happiest supporters of hopes for a recovery in the world’s No. 2 economy.

• Global Wrap: Asia’s benchmark stock index fell to a three-week low as worse-than-expected economic data from the US to Japan added to concerns about a broader slowdown.

choice

• ONGC, ICICI Lombard, Reliance Industries: India Options Wrap

• Kakaopay, KB Financial, LG H&H: South Korea Options Wrap

• Hyundai Steel, Amorepacific, Hyundai Mobis: Korea Option Pin Risk

This story was produced with the help of Bloomberg Automation.

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