Asian stocks mixed after Wall St tumble, China retail trade slows
BEIJING (AP) — Asian stocks gained on Tuesday after Wall Street returned some of last week’s huge gains, the U.S. and Chinese presidents met and China’s consumer spending declined, a sign that its economy weakens.
Shanghai, Tokyo and Hong Kong, which account for the bulk of the region’s market capitalization, rose. South Korea and Sydney declined. Oil prices have fallen.
Wall Street’s benchmark S&P 500 fell 0.9% on Monday, reversing some of last week’s 5.9% rise after lower US inflation boosted hopes that the Federal Reserve could ease planned rate hikes to curb soaring prices.
Presidents Joe Biden and Xi Jinping met at a Group of 20 major economies summit in Indonesia. This has fueled hopes for an easing of US-China tensions over security, trade, technology and human rights.
Monday’s meeting was “surprisingly positive” but “the feel-good factor that had boosted markets after the weaker-than-expected October CPI release in the US has evaporated,” they said. ING’s Robert Carnell and Nicholas Mapa in a report.
The Shanghai Composite Index gained 1.3% to 3,123.26 after Chinese consumer spending contracted 0.5% in October more than a year ago under pressure from increased virus controls. Growth in manufacturing activity also weakened.
The performance was worse than expected by forecasters who say Chinese economic activity will slow as interest rate hikes by global central banks depress demand for exports.
The Hang Seng in Hong Kong advanced 3.2% to 18,179.34 and the Nikkei 225 in Tokyo gained 0.1% to 28,002.40.
Seoul’s Kospi fell less than 0.1% to 2,472.93 and Sydney’s S&P-ASX 200 lost less than 0.1% to 7,141.60.
India Sensex opened 0.2% lower at 61,497.16. New Zealand, Singapore and Bangkok gained while Indonesia fell.
On Wall Street, the S&P 500 fell to 3,957.25. The Dow Jones Industrial Average fell 0.6% to 33,536.70. The Nasdaq composite fell 1.1% to 11,196.22.
Investors fear that this year’s repeated interest rate hikes to quell inflation that is near multi-decade highs could tip the global economy into recession.
Traders expected the Fed to raise its key rate again in December, but with a narrower margin of half a percentage point after four hikes of 0.75 percentage points.
Fed officials say rates may need to stay high for an extended period to cool prices.
The government is due to report on wholesale inflation in the United States on Tuesday. Economists say it likely slowed to 8.3% from September’s 8.5%.
On Wednesday, the US government takes stock of retail spending. Economists say growth likely picked up to 0.9% in October after stagnating the previous month.
In energy markets, benchmark U.S. crude fell 79 cents to $85.08 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell from $3.09 to $85.87 on Monday. Brent crude, the price basis for international oil trade, fell 54 cents to $92.60 a barrel in London. It fell from $2.85 the previous session to $93.14.
The dollar rose to 140.30 yen from 139.92 yen on Monday. The euro fell to $1.0332 from $1.0353.