- Investing.com -Monday saw a decline in most Asian stocks, with Chinese markets leading losses due to concerns over a potential trade war with the European Union. Investors were particularly uneasy due to the impending release of important U.S. inflation data.
- Regional markets followed Wall Street’s mediocre lead, as U.S. stock indexes fell from record highs on Friday due to profit-taking and interest rate worries. Asian trade saw a tepid response from U.S. stock index futures.
- Concerns that the durability of the US economy would keep interest rates high for a longer time have been raised by stronger-than-expected purchasing managers index data from the US.
- Fears of an EU trade war drive down Chinese markets.
- Shanghai Composite and Shanghai Shenzhen CSI 300 indexes dropped 0.4% and 0.8%, respectively, while Hong Kong’s Hang Seng index dropped 1% due to losses in mainland stocks.
- Following the European Union’s imposition of high duties on Chinese electric vehicle imports earlier in June, Chinese markets suffered prolonged losses. Beijing was incensed by the move, which increased the likelihood of a trade war.
- As German and Chinese ministers convened to discuss a way ahead, Chinese officials warned about an impending trade war with the EU. Additionally, Beijing was observed contemplating levying retaliation duties on European auto imports.
- Over the last two weeks, Chinese stocks have been suffering severe losses as unfavorable sentiment toward the nation and wider Asia persisted. Declines in heavyweight technology stocks caused losses in Hong Kong as well.
- Last week, the nation’s weak industrial production figures further soured sentiment.
- Other markets exposed to China declined. South Korea’s KOSPI dropped 0.9%, and Australia’s ASX 200 dipped 0.6%.
JP stocks surge as JPY intervention is considered
- On Monday, Japanese markets showed some small deviations, as the Nikkei 225 and TOPIX indexes both saw increases of 0.3%.
- The yen’s weakening versus the dollar, which was almost at its lowest point in more than 30 years, gave local stocks some hope.
- However, due to the yen’s weakness, investors were mostly cautious about Tokyo’s possible involvement in the currency market, especially after important Japanese finance ministers issued warnings against it.
- With attention on important U.S. inflation data this week for additional clues on interest rates, wider Asian markets moved in a flat-to-low range. The favored inflation indicator used by the Federal Reserve, the PCE price index, is due this Friday.
- The Nifty 50 index for India was expected to open weakly due to significant profit-taking following the index’s record-breaking highs earlier in June.
Source:
investing
