Asian stock markets fell Thursday as weak economic data from the U.S. and China added to worries about global growth, hitting shares of commodity producers especially hard.
Japan’s Nikkei 225 descended 105.31 points, or 0.8%, to 13,694.04
In Hong Kong, the Hang Seng Index returned from holiday, but lost 68.71 points, or 0.3%, to 22,668.30
Shares in Shanghai and Hong Kong dropped as investors got their first chance to react to the official Chinese manufacturing Purchasing Managers’ Index for April, released Wednesday. Both markets remained weak after HSBC, which releases a rival PMI measure, revised lower its April reading on activity at Chinese factories on Thursday.
HSBC’s chief economist for China, Qu Hongbin, said the drop in April PMI to 50.4 from 51.6 in March "confirmed a fragile growth recovery of the Chinese economy." The weak conditions could affect the labour market, likely inviting "more policy responses in coming months," he added.
The drop came after U.S. data on Wednesday, showing weak jobs addition by private employers and tepid growth in manufacturing, resulted in sharp losses on Wall Street.
The Federal Open Market Committee, meanwhile, said it would continue buying $85 billion U.S. in bonds each month but added it may raise or cut the program, subject to economic conditions.
Resource stocks came under selling pressure as the Chinese and U.S. data sparked fresh worries about demand from the world’s two largest economies.
In Sydney, mining heavyweight BHP Billiton Ltd. dropped 1.2%, and Fortescue Metals Group Ltd. skidded 4.3%.
Jiangxi Copper Co. fell 2.9%, and PetroChina Co. dropped 0.6% in Shanghai; in Hong Kong trade, they lost 1.2% and 2.1%, respectively.
Several steel makers also lost ground across the region on concerns about demand, with JFE Holdings Inc. slumping 4.8%, and Kobe Steel Ltd. dropping 3.1% in Tokyo.
Similarly, Wuhan Iron & Steel Co. retreated 1.9% in Shanghai and Hyundai Steel Colost 1.7% in Seoul.
The weak tone in Asia was also reflective of caution ahead of the Friday’s U.S. nonfarm payrolls data and the European Central Bank monetary-policy meeting later Thursday, where the central bank was expected to cut interest rates amid weakening economic indicators.
Over in Tokyo, trading volumes were modest ahead of a long weekend, with Japanese markets due to close on Friday and Monday.
Exporters were among the top decliners as the yen strengthened further against the U.S. dollar.
Among them, Nissan Motor Co. lost 2%, and Bridgestone shed 2.2%.
On the upside, Sharp Corp. jumped 5% after a Nikkei newspaper report that some banks were considering extending a 100-billion-yen ($1.01 billion U.S.) credit facility to the electronics company ahead of an upcoming bond redemption.
However, Fitch Ratings said in a statement it was maintaining a negative rating watch on the company, reflecting "growing risks to Sharp’s liquidity position in the short-term, due to its upcoming debt maturities and limited access to the capital markets."
Panasonic Corp. gained 0.3% after a separate Nikkei report that the company had unloaded shares worth about ¥100 billion in firms such as Toyota Motor Corp. Toyota stock lost 1.1%.
Minutes of the Bank of Japan’s last meeting in April, released earlier on Thursday, showed the central bank’s board members felt it was necessary for the bank to “enter a new phase of monetary easing.”
Shares of Lenovo Group Ltd. dropped 2.7% in Hong Kong after the company’s talks to buy a part of International Business Machines Corp.’s server business broke down due to differences over price.
Back in Sydney, Macquarie Group Ltd. rose 1% after The Australian reported the financial company was aiming for control of a portfolio of nine investment schemes managed by collapsed logging firm Gunns.
In other markets;
In Shanghai, the CSI 300 Index resumed trading with a gain of 2.33 points, or 0.1%, to 2,449.64
Singapore’s Straits Times Index returned from holiday to gain 34.21 points, or 1%, to 3,402.39
Taiwan’s Taiex Index gathered 34.85 points, or 0.4%, to 8,128.51
Korea’s Kospi Index shed 6.74 points, or 0.3%, to 1,957.21
The New Zealand Exchange 50 eased 28.56 points, or 0.6%, to 4,574.46
Australia’s S&P/ASX slid 36.22 points, or 0.7%, to 5,129.97
