Asian market slide Chinese investors have plowed into the Hong Kong market partly to hedge against the falling yuan. The Hang Seng HSI, +0.75% is up 0.8% for the week and has risen nearly 20.6% in the past six months, making it is the best-performing major benchmark in Asia for that period.
In contrast, the Shanghai Composite Index SHCOMP, -0.55% ended Friday 0.6% lower, with the tech-heavy Shenzhen Composite Index closing down 0.7%. The declines came as China released data confirming its producer prices continued to drop in August, signaling flagging demand in the world’s second-largest economy, albeit at a slower pace.
Australia’s S&P/ASX 200 XJO, -0.87% slipped 0.9% amid broad declines in commodity prices Friday. Copper was down 0.6% Friday, aluminum was lower by 0.2% with nickel down 0.5% and zinc off 0.7%.
Meanwhile, Japan’s Nikkei Stock Average NIK, +0.04% ended about flat as the yen appreciated against the U.S. dollar in Asian trade, balancing overnight declines. A stronger yen makes Japanese exporters less competitive.
The North Korean test put a worrisome spin on Asian markets with traders already fretting about the European Central Bank’s decision Thursday not to expand its stimulus program, defying expectations.
“It seems the recent deterioration in survey and inflation data is still not enough to push the ECB to ease further,” said Timothy Graf, head of macro strategy at State Street Global Markets EMEA. “We were expecting some language that would help prepare the market for easing later this year.”
Click here for reuse options!