Asia stocks down as China manufacturing slows
Asian markets fell Monday as China shares were dragged down by poor manufacturing figures and investors followed a drop on Wall Street.
A private survey of Chinese manufacturing activity showed a decline to a two-year low in July, suggesting the world’s second largest economy faces challenges in the third quarter.
Shanghai slipped 1.11 percent, or 40.82 points, to end at 3,622.91, while Hong Kong shed 0.91 percent or 224.86 points to close at 24,411.42.
Japan’s benchmark Nikkei 225 index slipped 0.18 percent, or 37.13 points, to finish at 20,548.11, while Seoul fell 21.67 points or 1.07 percent to close at 2,008.49.
Sydney eased 0.35 percent, or 19.9 points, to 5,679.3 ahead of the central bank’s monthly monetary policy meeting Tuesday.
Investor sentiment in China reflected the final reading of Caixin’s Purchasing Managers’ Index, which came in at 47.8 for July.
The figure was below the 49.4 registered in June and was the weakest reading since 47.7 in July 2013. A figure above 50 signals growth and anything below indicates contraction.
An official purchasing managers’ index released at the weekend had already shown a decrease for the month, decelerating to 50.0 from 50.2 in June.
Analysts predicted China’s government would further ease credit in the second half of 2015 to try to shore up growth.
HSBC meanwhile announced Monday in Hong Kong that net profit fell 3.8 percent in the three months to June, as the company agreed to sell its Brazilian business for US$5.2 billion to Brazil’s Banco Bradesco.
But the company emphasized a rise in pretax profits, which went up 10 percent over six months, pushing shares up 1.35 percent to end at HK$71.05 (US$9.17) compared with Friday trade.
Investors in Japan were meanwhile weighing earnings while energy-related shares were pushed lower as oil extended its biggest monthly drop in seven years.
Shares in automaker Honda bucked the trend with an 8.77-percent jump to 4,328 yen after it reported surging profits.
Asian markets had a negative lead from Wall Street where stocks closed lower Friday following poor earnings from ExxonMobil and Chevron.
In early European trading, The UK’s FTSE 100 was little changed at 6,694.02. Germany’s DAX rose 0.5 percent to 11,364.50 and France’s CAC- 40 gained 0.3 percent to 5,099.79. Stocks in Athens plunged more than 22 percent as the market reopened from a shutdown brought on by the near collapse of the country’s financial system during its high-wire bailout negotiations. Futures augured losses on Wall Street. Dow futures and S&P 500 futures both fell 0.1 percent.
Gold fetched US$1,092.73 an ounce compared with US$1,098.40 on Friday. In other markets: — Mumbai rose 0.26 percent, or 72.50 points, to end at 28,187.06 points.
State Bank of India climbed 3.94 percent to 281.05 rupees, while miner Vedanta Limited fell 2.50 percent to 126.90 rupees.
— Singapore closed down 0.30 percent, or 9.71 points, to 3,192.79.
Singapore Telecom fell 0.49 percent to SG$4.07 while DBS Bank gained 0.20 percent to SG$20.22.
— Kuala Lumpur’s main index rose 1.22 percent, or 21.05 points, to close the day on 1,721.50.
Public Bank added 0.32 percent to 19.06 ringgit, RHB Capital gained 0.54 percent 7.47 while Malayan Banking lost 0.22 percent to 9.18 ringgit.
— Jakarta ended down 0.05 percent, or 2.34 points, at 4,800.
Food manufacturer Tiga Pilar Sejahtera Food gained 1.30 percent to 1,950 rupiah, while palm oil producer Astra Agro Lestari fell 1.37 percent to 19,800 rupiah.
— Bangkok rose 0.13 percent, or 1.92 points, to 1,442.04
Kasikorn Bank gained 1.97 percent to 181.50 baht, while telecoms company Advanced Info Service dropped 1.20 percent to 247.00 baht.
— Wellington ended up 0.62 percent, or 36.89 points, at 5,957.85.
Air New Zealand rose 1.89 percent to NZ$2.69 and Contact Energy rose 1.41 percent at NZ$5.02.
— Manila ended 0.31 percent higher, rising 23.26 points to 7,573.26.
Top-traded GT Capital added 0.29 percent to 1,404.00 pesos while Globe Telecom gained 2.09 percent to 2,634.00 pesos.