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Market Update

Downbeat Data Drags Down Asia

Asian markets pushed lower Monday after Chinese economic data disappointed investors.

At close, the Nikkei was down 1.6%. The Shanghai Composite dropped 1.1% while the Hang Seng was down 1.4%. The S&P/ASX All Ordinaries gave up 1% but the Sensex recovered from early weakness to finish up 0.5% after domestic inflation during March dropped to a three-year low, raising hopes the central bank would cut interest rates to revive the sagging economy.

The main focus today, however, was on Chinese data, which showed first-quarter gross domestic product rose 7.7% from a year earlier compared with a 7.9% growth in the preceding quarter and below hopes for a growth of 8%. Investors seemed worried about the pace of recovery in the world’s second largest economy as they reacted to the data, sending stock markets lower in the region.

Industrial production in March was up 8.9% but below estimates for a 10% gain. And China’s urban fixed-asset investment also fell unexpectedly last month to a seasonally adjusted 20.9% from 21.2% in the preceding month. Also, Chinese retail sales grew 12.4% in the January-March period but were down 2.4% on a year-over-year basis.

Other data in the region showed industrial production in Japan rose last month to a seasonally adjusted 0.6%. Analysts had expected industrial production to remain unchanged at 0.0%.

In Australia, the number of home loans rose-more-than-expected last month while in Singapore, retail sales fell less-than-expected.

Stocks on the Move

Oil futures slipped after the release of the Chinese data on worries of slowing global demand for oil. Oil stocks were among the major losers as JX Holdings fell 3.3% in Tokyo. COSMO Oil fell 3.7%.

Then yen also weighed on exporters after weak U.S. retail sales data released last week Friday.

However, Sharp Corp. jumped 10.5% on a Nikkei newspaper report Saturday that the company has decided to sell its 9.2% stake in electronics maker Pioneer Corp. Pioneer shares also rose, and were up 5.7%.

Industrial stocks also suffered significant losses, weighed by the weak Chinese data.

Oil major CNOOC fell 3.2% in Hong Kong while PetroChina was down 3%. China Petroleum & Chemical Corp. gave up 2.4%.

Banks were also down with index heavyweight ICBC 1.7% lower.

Supplier to Wal-Mart and other U.S. retailers Li & Fung fell 1.9%.

Index leader BHP Billiton sank 3.2% in Sydney and rival miner Rio Tinto fell 3.2%. Woodside Petroleum slipped 1.1% while Santos was down 1.5%.

Gold miner Newcrest plunged 8.2%, tracking losses in gold prices.

Bucking the trend, stocks in Mumbai reversed earlier losses after better-than-expected inflation numbers supported expectations of interest-rate cuts.

Oil giant ONGC was the top gainer on the 30-share benchmark index, adding 3.5% while SBI added 3%. Bharti Airtel climbed 2.4%, Reliance Industries improved 2.4% and ITC ticked up 2.3%.

Among other gainers were some auto stocks and private lenders -- Maruti Suzuki raced up around a percent while Bajaj Auto edged up 0.3%. ICICI Bank also finished 0.3% higher.