Asian equities closed at their lowest level in more than three weeks as technology stocks fell on concerns about U.S. economic growth.
The MSCI Asia Pacific Index fell as much as 1.8%, before recovering some of the losses, with chipmakers Taiwan Semiconductor Manufacturing and Samsung Electronics among the biggest drags. Japanese stocks pared losses, with the Nikkei 225 index closing 0.5 percent lower, after slumping more than 3 percent during the day, helped by a weaker yen. Taiwan’s key indicator fell 1.4%, while Hong Kong’s benchmark indices posted their fifth straight day of declines. Weak U.S. nonfarm payrolls data on Friday sparked concerns that the Federal Reserve is acting too slowly to support the world’s largest economy. As investors try to gauge the magnitude of the Fed’s rate cut next week, the Bank of Japan’s recent decision to tighten monetary policy has pushed up the country’s currency, stoking concerns about carry trades.
According to Matthew Haupt, portfolio manager at Wilson Asset Management International, there is a possibility that “risk assets will suffer further declines in the near term.”as positions are likely to be unwound.” “Chinese stocks plunged as weak producer and consumer price data released on Monday pointed to persistent deflationary pressures. The country’s stocks have seen a series of downgrades recently as weak economic data raises doubts about its 5% GDP growth target for 2024.
Sectors to consider
- Shares of Oil and Natural Gas Corp. fell as much as 4.6%, hitting their lowest level since July 10, after Citi cut its rating on the Indian energy company to neutral from buy as crude’s recent drop below $75 a barrel poses a downside risk to earnings.
- Shares of mobile phone supplier Huawei are advancing after the Chinese tech firm opened pre-orders for its triple-decker smartphones.
- Shares of some Chinese medical equipment makers are advancing after authorities said they will allow more foreign investment in the sector to revive economic growth.
- Shares of Chinese property developers fell after China Vanke reported that its sales decline worsened in August.
