Asian stocks yesterday declined amid concern global growth is faltering after US Federal Reserve officials said that a US interest-rate increase is still warranted this year. Markets in Japan are closed.
BHP Billiton Ltd sank 2.5 percent in Sydney as commodities companies led losses across the region. Esprit Holdings Ltd sank 6.2 percent in Hong Kong, after shareholder activist David Webb said the Financial Reporting Council might be investigating the company.
China Railway Group Ltd (中國中鐵) surged in Shanghai after saying it plans to inject manufacturing units into China Railway Erju Co (中國中鐵二局) in exchange for assets.
Photo: Reuters
The MSCI Asia Pacific Excluding Japan Index lost 1.8 percent to 404.83 as of 4:36pm in Hong Kong. Three US policymakers at the weekend separately explained their rationale for supporting a rate increase at one of the Fed’s two remaining meetings of this year, citing declines in unemployment and other gains in the US economy that should outweigh headwinds from slower growth abroad and turbulent financial markets.
“The key thing is that the markets are looking for global growth and we’re not seeing any,” Allianz Global Investors chief investment officer for Asia Pacific Raymond Chan said.
“It’s the US and China driving sentiment — it’s pretty bad. I’d prefer if there was a US rate rise once and for all, and that would clear away all the uncertainty. Volatility is going to continue to exist for a long while,” Chan said.
Hong Kong’s Hang Seng Index declined 0.8 percent and the TAIEX lost 1.83 percent. The Shanghai Composite Index gained 1.9 percent.
However, China’s economy is not as weak as it might look, according to a private survey.
“No collapse is nigh,” in the aftermath of the stock market plunge and currency devaluation, according to the third-quarter China Beige Book survey published by New York-based CBB International. Capital expenditure rebounded slightly in the period and the services sector showed strength, the report said.
Australia’s S&P/ASX 200 Index fell 2 percent and South Korea’s KOSPI retreated 1.6 percent. New Zealand’s S&P/NZX 50 Index slipped 0.5 percent and India’s S&P BSE SENSEX decreased 0.3 percent.
E-mini futures on the S&P 500 slipped 0.1 percent yesterday. The Standard & Poor’s 500 Index lost 1.6 percent on Friday.
Traders say the Fed is most likely to postpone liftoff until next year, based on the pricing of federal funds futures contracts.
Investors are to hear directly from Fed Chair Janet Yellen on Thursday, when she delivers a speech in Amherst, Massachusetts.
San Francisco Fed President John Williams, a policy centrist who has worked closely with Yellen, on Sunday said that “in my mind, it was a close call” to delay a rate increase at last week’s Federal Open Market Committee (FOMC) meeting.
Williams’ comments on Fox News echoed remarks he made the day before and chimed with the reasoning of St Louis Fed President James Bullard and Richmond Fed President Jeffrey Lacker. Both weighed in on Saturday over the FOMC’s vote to leave rates near zero.
“We expect to remain bearish,” RMG Wealth Management LLP chief investment officer Stewart Richardson said.
“The Fed seems to be coming in for more criticism from all sides, and with markets falling after a dovish meeting, we believe that their credibility is now being openly questioned. We continue to believe that long-term investors should be holding a lot of cash at this point in the cycle,” he said.
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],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
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