Asian stocks sluggish as Wall St declines
Nikkei, Hang Seng, Kospi, and Shanghai in the red; European stocks trading marginally higher in early session
image for illustrative purpose
After recording best week since February, Wall Street slipped into pressure. The Dow Jones Industrial Average also fell 0.9%, to 35,650.95. The tech-heavy Nasdaq composite slid 1.4% to 15,413.28. On Monday, the S&P 500 fell 0.9% to 4,669.97, giving back some of its gains
Bangkok: Shares opened higher in Europe on Tuesday after Asian shares followed Wall Street lower as investors awaited fresh US inflation data and the outcome of a meeting of the Federal Reserve. Benchmarks advanced in Paris, London and Frankfurt, but fell in Hong Kong, Shanghai and Tokyo. The Labor Department's Producer Price Index for November is due out Tuesday.
That shows how inflation is impacting costs for businesses and is important given the Fed meeting on Tuesday and Wednesday. The US central bank could announce plans to accelerate its timetable for reducing bond purchases aimed at keeping long-term interest rates low. Markets have kept their cool despite warnings that the omicron coronavirus variant is spreading rapidly in Britain and some other regions. In London, the FTSE 100 gained 0.6% to 7,274.71, while Germany's DAX added 0.4% to 15,678.78. In Paris, the CAC 40 climbed 0.5% to 6,979.16. U.S. futures also rose, with the contract for the S&P 500 and the Dow industrials up 0.3%. Hong Kong's benchmark slipped Tuesday on persisting worries over property developers.
Shares in Shanghai-based Shimao Group Holdings sank 20% in Hong Kong on concerns about its financial situation. China Evergrande Group's shares gave up 7%. Evergrande is one of China's largest developers, with over $300 billion in debt. Chinese leaders have promised tax cuts and support for entrepreneurs to shore up slumping economic growth as the country grapples with bankruptcies and defaults among real estate developers caused by a campaign to rein in surging debt. "Recent scrutiny has gripped hold of Shimao Group Holdings, China's 13th largest developer by contracted sales, on its liquidity position and debt-servicing ability.
That may continue to put the property sector on watch today," said Yeap Jun Rong of IG. Another worry is China's first reported case of the omicron variant of coronavirus, Yeap added. Hong Kong's Hang Seng slipped 1.3% to 23,635.95 and the Nikkei 225 in Tokyo lost 0.7% to 28,432.64. In Seoul, the Kospi fell 0.7% to 2,987.95. The Shanghai Composite index shed 0.6% to 3,661.53, while Australia's S&P/ASX 200 was nearly unchanged at 7,378.40.
