Emerging-market stocks fell for an eighth day after Chinese factory and retail sales data indicated that the world’s second-largest economy is slowing further.
China Construction Bank Corp (中國建設銀行) led a gauge of Hong Kong-traded Chinese shares to a five-week low. China Petroleum & Chemical Corp (中國石化) sank 5.5 percent in Hong Kong after the refiner known as Sinopec agreed to sell a 107 billion yuan (US$17.5 billion) stake in its retail unit. India’s rupee dropped to a one-month low as Asian currencies weakened.
The MSCI Emerging Markets Index fell 0.6 percent to 1,055.47 at 12:51pm yesterday, poised for its longest run of losses since the 10 days through Nov. 13 last year.
Photo: Bloomberg
Reports on Chinese industrial production, retail sales and asset investment over the weekend all missed estimates, underscoring the risks of a deepening economic slowdown. Some of the factors that have becalmed developed nations are increasing risks for emerging markets, affecting US$1.4 trillion in funds focused on those assets, the Bank for International Settlements said.
“China’s economic slowdown will be a drag on other developing countries because Chinese demand represents a significant portion of exports,” said Porranee Thongyen, head of research at Asia Plus Securities PCL in Bangkok.
The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong slid 1.6 percent. China Construction Bank, the nation’s second-biggest bank by assets, fell 1 percent to a one-week low. China Life Insurance (中國人壽), the country’s biggest insurer, lost 1.5 percent. The Shanghai Composite Index slipped 0.2 percent after closing at an 18-month high on Friday last week.
China’s industrial output last month rose 6.9 percent from a year earlier, the statistics bureau said on Saturday, down from 9 percent in July. That is the slowest pace outside the January-February Lunar New Year holiday period since December 2008, based on previously reported figures compiled by Bloomberg.
Retail sales gained 11.9 percent and fixed-asset investment in the January-August period climbed 16.5 percent, both missing analyst estimates.
The data add to risks that China’s third-quarter economic growth will drop below Chinese Premier Li Keqiang’s (李克強) goal for this year of about 7.5 percent after a measure of new credit released last week trailed estimates and last month’s imports dropped.
Li last week said that the government will not rely on monetary stimulus to spur growth and will stick to targeted policies.
India’s S&P BSE SENSEX dropped 0.8 percent, poised for the sharpest decline in more than a month. The rupee slid 0.6 percent.
The Philippine Stock Exchange Index lost 0.6 percent. Malaysia’s FTSE Bursa Malaysia KLCI retreated 0.5 percent, while South Korea’s KOSPI fell 0.2 percent.
The Indonesian rupiah and Malaysian ringgit weakened 0.7 percent, while the Philippine peso lost 0.4 percent.
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