Asian stocks in red zone despite good Chinese economic data
2023.01.31 01:19
Asian stocks in red zone despite good Chinese economic data
By Tiffany Smith
Budrigannews.com – On Tuesday, fears of hawkish signals from a Federal Reserve meeting this week outweighed data indicating a rebound in Chinese business activity. As a result, the majority of Asian stock markets fell.
Even though government data showed that Chinese and activity rebounded strongly into expansion territory in January, China’s and indexes fell 1% and 0.5 percent, respectively.
The reading suggests that the country’s loosening of restrictions against COVID is benefiting the economy and is likely to spur a larger recovery later this year. Chinese bourses were also expected to gain, albeit slightly, for the third month in a row.
The day’s worst performers were technology-heavy Asian indexes as a spillover from an overnight decline in U.S. heavyweights. South Korea’s and the index lost 0.7% and 1.3%, respectively, while Hong Kong’s lost 1%.
The anticipation of the Fed meeting, which was scheduled for Wednesday, sent tech stocks reeling. However, given that recent signs of resilience in the U.S. economy give the central bank more leeway to keep raising interest rates, markets are wary of any hawkish signals from the Fed.
Japan’s losses were somewhat limited after data revealed that they increased more than anticipated in December. The reading suggests that non-manufacturing businesses are still resilient despite a slowdown in Japan’s industrial sector.
After defying market expectations and maintaining its yield curve control policy, Japanese stocks were also among the best performers in Asia in January, rising nearly 5%.
The economy’s woes were exacerbated by significantly weaker-than-anticipated data, which led to a 0.2% decline in the index in Australia. Rising inflation and high interest rates are creating additional obstacles.
Even with a rout in the shares of companies that are part of the Adani Group, India’s and indexes both fell by about 0.4% (NS:). seemed to be getting better. In anticipation of the release of the on Wednesday, local markets became nervous.
Indian shares were on track to significantly underperform their Asian counterparts in January due to losses in Adani and stocks linked to the conglomerate. The BSE Sensex 30 was down 2.7% this month, and the Nifty 50 was expected to fall by 3.1%.
