Asian shares slide as Chinese growth data disappoints
Asian shares were mostly lower on Monday after China reported its economy grew at a meager 4.9 percent annual pace in July-September.
image for illustrative purpose
Hong Kong: Asian shares were mostly lower on Monday after China reported its economy grew at a meager 4.9 percent annual pace in July-September. The Shanghai Composite index lost 0.4 percent to 3,559.96 while the Hang Seng in Hong Kong declined 0.4 percent to 25,246.38. Chinese growth is under pressure from government controls meant to curb energy use and reduce financial risks from reliance on debt-fueled property developments. Manufacturing also has been hampered by shortages of processor chips and other components due to the pandemic.
Compared with the previous quarter, the way other major economies are measured, output in the July-September period barely grew, expanding by just 0.2 percent. That was down from the April-June period's 1.2 percent and one of the weakest quarters of the past decade. The 4.9 percent annual pace of growth was slighly below forecasts and compared with a 7.9 percent expansion in the April-June quarter, which was exaggerated by the downturn in 2020. "The growth outlook has weakened due to the various headwinds," Tommy Wu and Louis Kuijs of Oxford Economics said in a report. They forecast that growth would slow significantly in the current quarter.
Power shortages might persists, while other disruptions to manufacturing supply chains will likely ease. Weakness in the real estate sector, with major developer China Evergrande Group struggling to meet its debt obligations, would also slow activity, they said. Other regional shares also fell. Tokyo's Nikkei 225 index edged 0.2 percent lower, to 29,013.29. Shares also slipped in Taiwan and Singapore, while in Seoul, the Kospi was flat, at 3,014.44. The S&P/ASX 200 in Sydney rose 0.2 percent to 7,377.70. India's benchmark rose 0.8 percent to 61,771.40. On Friday, Wall Street added to its recent gains, with the benchmark S&P 500 posting its best week since July. The S&P 500 rose 0.7 percent, while the Dow Jones Industrial Average rose 1.1percent and the Nasdaq composite gained 0.5percent.
