Asian markets sank further in holiday-thinned trade yesterday, following another global sell-off caused by anxieties over emerging markets and further disappointing manufacturing data out of China.
The euro edged up against the yen after falling in New York in response to weak eurozone inflation figures that added to fears of deflation in the currency bloc.
Tokyo fell 1.98 percent, or 295.40 points, to 14,619.13 and Seoul slipped 1.09 percent, or 21.19 points, to 1,919.96.
Photo: Reuters
Sydney closed flat, edging down 2.1 points to 5,187.9 while Wellington eased 0.51 percent, or 25.08 points, to 4,849.50.
However, Bangkok was up 1.10 percent despite chaotic weekend elections that saw thousands of polling stations closed by opposition protestors following weeks of anti-government demonstrations.
Taipei, Shanghai, Hong Kong, and Kuala Lumpur were closed for the Lunar New Year holiday.
Global equities tanked last week after the US Federal Reserve said it would further cut its stimulus program, sparking fears of a flight of capital from developing nations while also sending their currencies falling against the US dollar.
That in turn was fueling buying of the yen, which was being viewed as safe haven, and that was helping send regional stocks lower, Toyo Securities Co strategist Hiroaki Hiwada said.
The stock fall in New York was also weighing on investor sentiment, he said.
“There is little good news to trade on. Maybe by next week, people will start to buy shares back,” Hiwada said.
On Friday the Dow sank 0.94 percent, the S&P 500 fell 0.65 percent and the NASDAQ lost 0.47 percent.
Earlier in Europe the FTSE 100 in London ended 0.43 percent lower, Frankfurt’s DAX 30 dropped 0.71 percent and the CAC 40 in Paris slid 0.34 percent.
The euro was little changed at US$1.3485. The US dollar rose to ￥102.23 from ￥101.96 late on Friday, but is down from about ￥105 at the beginning of the year.
“There’s still some nervousness about emerging markets,” investment adviser Christopher Macdonald told Dow Jones Newswires. “People are wondering if the jitters we saw last month are a sign of some bigger dislocation in the market.”
Adding to the downbeat outlook was official data from China pointing to a slowdown in manufacturing activity in the world’s second-largest economy and key driver of global growth.
The purchasing managers’ index (PMI) fell to 50.5 last month from 51 in December last year and 51.4 in November, the Chinese National Bureau of Statistics and the China Federation of Logistics and Purchasing said on Saturday.
Any figure above 50 indicates expansion while anything below signals contraction.
The news came days after banking giant HSBC’s China PMI came in at a six-month low of 49.5.
“There is no doubt that the surging money-market rates have added uncertainty and dampened industry confidence,” said Liu Li-gang (劉利剛), chief Greater China economist at Australia & New Zealand Banking Group Ltd in Hong Kong.
The Chinese central bank will “have to strike a delicate balance” between cracking down on shadow banking and maintaining financial stability, Liu said.
A separate report released yesterday on the non-manufacturing sector also showed a deterioration, with that PMI falling to 53.4 last month from 54.6 in December last year.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) secured a record 70.2 percent share of the global foundry business in the second quarter, up from 67.6 percent the previous quarter, and continued widening its lead over second-placed Samsung Electronics Co, TrendForce Corp (集邦科技) said on Monday. TSMC posted US$30.24 billion in sales in the April-to-June period, up 18.5 percent from the previous quarter, driven by major smartphone customers entering their ramp-up cycle and robust demand for artificial intelligence chips, laptops and PCs, which boosted wafer shipments and average selling prices, TrendForce said in a report. Samsung’s sales also grew in the second quarter, up
LIMITED IMPACT: Investor confidence was likely sustained by its relatively small exposure to the Chinese market, as only less advanced chips are made in Nanjing Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) saw its stock price close steady yesterday in a sign that the loss of the validated end user (VEU) status for its Nanjing, China, fab should have a mild impact on the world’s biggest contract chipmaker financially and technologically. Media reports about the waiver loss sent TSMC down 1.29 percent during the early trading session yesterday, but the stock soon regained strength and ended at NT$1,160, unchanged from Tuesday. Investors’ confidence in TSMC was likely built on its relatively small exposure to the Chinese market, as Chinese customers contributed about 9 percent to TSMC’s revenue last
LOOPHOLES: The move is to end a break that was aiding foreign producers without any similar benefit for US manufacturers, the US Department of Commerce said US President Donald Trump’s administration would make it harder for Samsung Electronics Co and SK Hynix Inc to ship critical equipment to their chipmaking operations in China, dealing a potential blow to the companies’ production in the world’s largest semiconductor market. The US Department of Commerce in a notice published on Friday said that it was revoking waivers for Samsung and SK Hynix to use US technologies in their Chinese operations. The companies had been operating in China under regulations that allow them to import chipmaking equipment without applying for a new license each time. The move would revise what is known
UNCERTAINTY: A final ruling against the president’s tariffs would upend his trade deals and force the government to content with billions of dollars in refunds The legal fight over US President Donald Trump’s global tariffs is deepening after a federal appeals court ruled the levies were issued illegally under an emergency law, extending the chaos in global trade. A 7-4 decision by a panel of judges on Friday was a major setback for Trump, even as it gives both sides something to boast about. The majority upheld a May ruling by the Court of International Trade that the tariffs were illegal. However, the judges left the levies intact while the case proceeds, as Trump had requested, and suggested that any injunction could potentially be narrowed to apply
RSS