On Friday, Asian stocks fell again after rising German inflation, British Prime Minister Liz Truss championed a tax cut plan that rattled investors and Chinese factory activity weakened.
Taipei, Shanghai, Tokyo and Sydney fell, but shares rose slightly in Hong Kong.
Wall Street’s benchmark S&P 500 index fell 2.1% to its lowest level in nearly two years on Thursday after strong U.S. jobs data bolstered expectations that the Federal Reserve US would stick to its plans for further interest rate hikes.
Photo: AFP
Investors are increasingly concerned that the global economy could tip into recession following interest rate hikes by the Fed and central banks in Europe and Asia to calm inflation that is in its highest for several decades. Global export demand is weakening and Russia’s attack on Ukraine has disrupted oil and gas markets.
Markets fell on Thursday after Germany reported inflation accelerated to 10.9% last month and German Chancellor Olaf Scholz said the world’s fourth-largest economy faced a ‘double whammy’ ” with soaring energy prices.
“We would be inclined to say we haven’t seen the bottom yet,” ING economists said in a report.
The TAIEX on Friday fell 109.68 points, or 0.81%, to 13,424.58 on turnover of NT$207.93 billion ($6.55 billion).
The Shanghai Composite Index fell 0.55% to 3,024.39 after surveys of manufacturers showed industrial production, new export orders and manufacturing employment fell last month.
In Tokyo, the Nikkei 225 fell 1.83% to 25,937.21, to end the week down 4.48%, while the broader TOPIX lost 32.86 points, or 1.76%, at 1,835.94, losing 4.18% for the week.
Hong Kong’s Hang Seng Index rose 0.33% to 17,222.83 but fell 3.96% for the week, while South Korea’s KOSPI lost 0.71% to 2,155. .49, down 5.87% for the week.
Sydney’s S&P ASX 200 fell 1.23% to 6,474.2, losing 1.53% for the week, while India’s SENSX index rose 1.8% to 57,426.92 .
Investors were already worried about signs of weakening global activity before the Truss government announced multibillion-dollar tax cuts. Traders fear this will drive up already high inflation, forcing Britain’s central bank to slow economic growth by raising interest rates further.
Stock markets and the value of the pound rebounded on Wednesday after the Bank of England announced it would buy government bonds to support their price, but markets resumed their slide on Thursday after Truss shrugged off criticism and defended his tax cut plan despite a plea from the IMF. backtrack.
In China, surveys of manufacturers by business news magazine Caixin found that production and new orders had fallen. This was in line with expectations that a Chinese manufacturing boom would fade due to weak global demand.
The monthly Caixin Purchasing Managers Index fell from its August level, while a separate index from the China Logistics and Purchasing Federation edged above a breakeven point that shows rising activity. .
“The slowdown in external demand is expected to worsen,” Capital Economics economist Zichun Huang said in a report.
Additional reports by Staff Writer, with CNA
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