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Market Update

Asia Down on Weak China Data; Sydney Up 1%

Mainland Chinese stocks led most Asian markets lower Tuesday after preliminary data showing less-than-expected growth in China's manufacturing activity raised concerns about recovery in the world's second largest economy.

The Shanghai Composite dropped 2.6%, the Hang Seng lost 1.1% while the Nikkei retreated 0.3%. The Sensex managed to finish a choppy session 0.1% above the flatline.

Australia's S&P/ASX All Ordinaries, however, bucked the trend despite a poor flash China PMI reading. China is Australia's top destination for mining exports and any slump in industrial activity there affects the demand for Australian miners.

The preliminary reading of HSBC's manufacturing purchasing managers' index fell to a two-month low of 50.5 in April, from the final reading of 51.6 in the previous month and below analysts expectations; spurring fears economy recovery in China could be faltering.

Commodities dipped into the red following the disappointing news.  Silver and copper futures were trading around 3% and 1% lower while crude oil drifted 1% down to $88.23 per barrel in late Asian afternoon hours.

Stocks on the move

Resources stocks were mostly on the losers' side. In Hong Kong, Angang Steel dropped 1.4%, Jiangxi Copper lost 1.8% while Aluminum Corp. of China erased over 1%.

Among oil stocks, PetroChina shed 1.3% while China Petroleum slipped 2.5%. CNOOC finished 0.7% lower.

Property stocks were among other major laggards of the day as fears mounted a slowdown in the economy would affect real-estate prices.

Shanghai-listed Gemdale Corp plunged nearly 5% while Poly Real Estate tumbled 4.7%. The broader Shenzhen-listed China Vanke was down 3.5%.

Sydney-listed miners also pushed into the negative zone on heels of the weak Chinese data. Index leader BHP Billiton dropped lost 1.1% while close miner Rio Tinto fell 2.3%. Gold miner Newcrest Mining tumbled 3.3%.

But oil firms gained ground, posting sharp gains. Woodside Petroleum soared 9.7% after the company said it would return cash to its shareholders through a special dividend, and also increase its dividend payout ratio.

Santos rose over 3% while AGL Energy added around a percent.

In Tokyo, exporters pushed lower after staging a rally in the previous session as investors booked profits and as the yen grew stronger against the dollar.

Car manufacturers Nissan Motor and Toyota Motor skidded around a percent while Sharp Corp. gave up 2.3%.

Among Hong Kong-listed exporters, Foxconn International Holdings fell around 3% while Esprit Holdings retreated around 1.5%.

In Mumbai, stocks lost momentum after initial gains, tracking weakness in overseas markets. The market, however, recovered in the final hours of trade, ending just near the flat-line.

Among the losers were capital goods, banking stocks and FMCG companies.

Jindal Steel dropped 3.8%, L&T slipped over 2% while State Bank of India retreated 1.6%. HDFC Bank lost 1.4% while BHEL, Gail India and Tata Power eased around 1% to 1.2%.

On the other side, auto stocks, IT firms and some drug companies supported with modest gains. Hero MotorCorp. accelerated 2.9% while Bajai Auto geared up 2.4%.

Wipro and Infosys gained around 1% each while TCS was up 0.3%.

Pharma companies Sun Pharma and Dr. Reddys Lab finished up 2.5% and 1% respectively.