Asian markets tumbled yesterday amid renewed fears of a Greek sovereign default and its impact on the world economy, as investors digested the failure of Athens to meet its budget deficit target.
European stocks slumped and the euro hit an eight-month dollar low yesterday after Greece said it would not meet a target for reducing its massive deficit, heaping fresh pressure on the eurozone crisis.
The Frankfurt market dived more than 3 percent and bank stocks tumbled on the first trading day of the fourth quarter after Greece said the budget deficit should drop to 8.5 percent of GDP this year, short of an earlier target.
The euro struck US$1.3314 — the lowest point since January — before a meeting yesterday of eurozone finance ministers to decide whether Greece should receive an 8 billion euro (US$10.9 billion) loan installment.
“We’ve begun the fourth quarter in much the same way as we ended the third. European equities were under pressure from the open after falls in Asian-Pacific markets overnight ... following news that Greece will miss yet another deficit target, said David Morrison, an analyst at GFT trading group.
“Although the major stock indices have managed to bounce off lower levels, they look vulnerable to further selling. Europe’s leaders have no good choices and continue to pretend that their problems will eventually be solved by stronger growth alone,” he said.
Greece’s acknowledgement on Sunday that it would miss its deficit targets raised further uncertainty over whether its fresh budget cuts would be enough for it to secure the next tranche of its multibillion euro bailout.
Athens needs the payment to avoid bankruptcy next month.
Asian stocks plunged yesterday, with Taipei slipping 2.93 percent and Hong Kong closing down 4.38 percent. Tokyo was down 1.78 percent, Sydney shed 2.78 percent and Singapore was down 2.52 percent. Bangkok was off 3.74 percent, Jakarta dived 4.04 percent and Kuala Lumpur was down 2.17 percent. Wellington slid 0.7 percent.
Markets in South Korea and China were closed.
World stock markets endured their worst quarterly losses since the 2008 financial crisis in the three months to Sept. 30, as investors dumped equities for safer assets on worries over a global recession.
“With stocks down and bonds up this can mean only one thing,” said Simon Denham, analyst at Capital Spreads trading group.
“Traders are in no mood for taking risks as economic growth has shown a slow down and leaders assess what effect a potential Greek default would have on the growth of emerging economies,” he said.
“In line with the risk aversion, we are seeing the dollar remain as the safe haven option for traders,” he said.
As if Greek jitters were not enough, there is a lot of potential news this week that could affect the market mood. A raft of US economic data was to start yesterday with the release of the monthly manufacturing survey from the Institute for Supply Management. A collapse in its main indicator in August was one of the triggers behind the turmoil that has gripped financial markets since.
The US dataflow this week culminates with Friday’s nonfarm payrolls report for last month. The figures often set the tone in markets for a week or two after their release and another weak number could well reinforce concerns over the world’s largest economy.
Central banks in Europe will also feature, with both the European Central Bank and the Bank of England under pressure to do more to boost growth.
Though inflation in both the eurozone and Britain are running uncomfortably above target, investors will be looking to see if the bank reverses course and starts cutting rates, just two months after raising them, and if the Bank of England authorizes another monetary stimulus.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained