ZCZC
BCN-03
ASIA-MARKETS
Asian markets in retreat as China growth slows further
HONG KONG, July 15, 2019 (BSS/AFP) – Asian markets slipped on Monday as
data showed China’s economy growing at its weakest pace in nearly three
decades, hit by the US trade war, while investors debate the depth of an
expected Federal Reserve interest rate cut.
The world’s number-two economy expanded 6.2 percent in April-June, the
worst reading since the early 1990s but in line with forecasts and within the
government’s target range.
The reading highlights the negative impact the US tariffs stand-off is
having on China as leaders also try to recalibrate the growth model from
exports and state investment to one driven by consumer spending.
“While GDP touched a 27-year low in Q2, the on-consensus print does lessen
market fears that China’s economy is headed for a hard landing,” said Stephen
Innes at Vanguard Markets.
Observers also pointed out that the weakness raised the chances of further
monetary easing measures from the central People’s Bank of China, while
investors were also tracking the progress of trade talks between Washington
and Beijing.
“While the PBoC has already delivered stimulus this year, markets are
awaiting a bazooka of (bank reserve ratio) cuts and additional measures,
which will probably come if trade talks collapse,” said OANDA senior market
analyst Edward Moya.
“If talks steadily progress, we will still probably see the PBoC deliver
fresh stimulus following the Fed’s highly anticipated rate cut at the end of
the month.”
In early trade Hong Kong was down 0.2 percent and Shanghai slipped 0.3
percent, while Sydney shed 0.5 percent.
Singapore was off 0.2 percent, Seoul dropped 0.1 percent and Wellington
fell 0.4 percent but Taipei edged up 0.1 percent, Manila surged one percent
and Jakarta jumped 0.7 percent. Tokyo was closed for a holiday.
The drops came despite a record-breaking close for all three main indexes
in New York on Friday.
MORE/HR/0922
ZCZC
BCN-04
ASIA-MARKETS 2 LAST HONG KONG
The dollar was slightly lower against most high-yielding, riskier
currencies on bets the Fed will cut borrowing costs at the end of the month,
though there is speculation about how far it will go.
While bank boss Jerome Powell’s congressional testimony last week flagged
a reduction, data indicating inflation remains reasonably healthy has kept
investors guessing.
Bitcoin plunged almost $2,000 to $10,000 after Donald Trump last week
expressed his mistrust of cryptocurrencies, saying it was “not money” and
warning that those wishing to join the trade would have to abide by banking
regulations.
– Key figures around 0300 GMT –
Hong Kong – Hang Seng: DOWN 0.2 percent at 28,414.37
Shanghai – Composite: DOWN 0.3 percent at 2,922.21
Tokyo – Nikkei 225: Closed for a holiday
Euro/dollar: UP at $1.1271 from $1.1270 at 2100 GMT on Friday
Pound/dollar: DOWN at $1.2565 from $1.2576
Dollar/yen: DOWN at 107.87 yen from 107.89 yen
West Texas Intermediate: DOWN six cents at $60.15 per barrel
Brent North Sea crude: DOWN six cents at $66.66 per barrel
New York – Dow: UP 0.9 percent at 27,332.03 (close)
London – FTSE 100: FLAT at 7,505.97 (close)
BSS/AFP/HR/0925