Asian markets follow Wall Street plunge following weak US data

Asian markets sank yesterday following a worse-than-expected reading of US factory activity that revived worries about the impact of the trade war on the global economy.

Adding to the selling pressure in Hong Kong were long-running concerns about the impact of increasingly violent pro-democracy protests in the city that saw a demonstrator shot and wounded by police on Tuesday.

Regional investors took their lead from Wall Street, where equities tanked in response to news that an index of US manufacturing activity fell last month to its lowest point since June 2009.

The data pointed to the impact of the China-US trade war on the world’s top economy and will likely put pressure on Donald Trump to push through an agreement. Top-level talks are planned for this month.

Manufacturing is “thought to be the specific chunk of the economy the president must... protect and the sector the US aggressive trade policies were supposed to enhance”, said Stephen Innes, Asia-Pacific market analyst at AxiTrader.

“So, the data could also imply not only monetary policy infusion is on the way but could increase the odds of some type of trade war detente.”

The figures combined with a weak eurozone inflation reading and a contraction in Britain’s economy in the second quarter.

Tokyo ended 0.5 per cent lower, Sydney fell 1.5 per cent and Singapore lost 1.2 per cent, with Manila also off more than one percent. Taipei, Wellington, Bangkok and Jakarta were also lower.

Seoul shed almost two percent after North Korea fired a missile into the sea just a day after Pyongyang said it would resume stalled nuclear talks this week.

“Looking at the broader picture, it is fair to say that the worldwide manufacturing sector is in trouble,” said David Madden, market analyst at CMC Markets. “The US-China trade spat is having a knock-on effect around the globe.”

Hong Kong fell 0.2 per cent — though it pared earlier steep losses — as investors returned from a public holiday to mark China’s National Day but which saw some of the worst violence in the city since protests began in June. A teenager was shot in the chest by a policeman, fuelling fears of a worsening of the unrest that has crippled the city’s economy.

Shanghai was closed for a holiday.

On currency markets the dollar inched back after dropping Tuesday following the US factory data, which led to speculation the Federal Reserve will cut interest rates again this month.

 

Asian markets follow Wall Street plunge following weak US data

Asian markets sank yesterday following a worse-than-expected reading of US factory activity that revived worries about the impact of the trade war on the global economy. Adding to the selling pressure in Hong Kong were long-running concerns about the impact of increasingly violent pro-democracy protests in the city that saw a demonstrator shot and wounded by police on Tuesday. Regional investors took their lead from Wall Street, where equities tanked in response to news that an index of US manufacturing activity fell last month to its lowest point since June 2009. The data pointed to the impact of the China-US trade war on the worlds top economy and will likely put pressure on Donald Trump to push through an agreement. Top-level talks are planned for this month. Manufacturing is thought to be the specific chunk of the economy the president must... protect and the sector the US aggressive trade policies were supposed to enhance, said Stephen Innes, Asia-Pacific market analyst at AxiTrader. So, the data could also imply not only monetary policy infusion is on the way but could increase the odds of some type of trade war detente. The figures combined with a weak eurozone inflation reading and a contraction in Britains economy in the second quarter. Tokyo ended 0.5 per cent lower, Sydney fell 1.5 per cent and Singapore lost 1.2 per cent, with Manila also off more than one percent. Taipei, Wellington, Bangkok and Jakarta were also lower. Seoul shed almost two percent after North Korea fired a missile into the sea just a day after Pyongyang said it would resume stalled nuclear talks this week. Looking at the broader picture, it is fair to say that the worldwide manufacturing sector is in trouble, said David Madden, market analyst at CMC Markets. The US-China trade spat is having a knock-on effect around the globe. Hong Kong fell 0.2 per cent though it pared earlier steep losses as investors returned from a public holiday to mark Chinas National Day but which saw some of the worst violence in the city since protests began in June. A teenager was shot in the chest by a policeman, fuelling fears of a worsening of the unrest that has crippled the citys economy. Shanghai was closed for a holiday. On currency markets the dollar inched back after dropping Tuesday following the US factory data, which led to speculation the Federal Reserve will cut interest rates again this month.