Asian Stock Market: Trades lower, investors worry about US rate hike, China’s economic woes
- Asian stock markets edge lower amid the fear of more rates hike, China’s economic woes.
- Evergrande, China’s second-largest real estate company filed for bankruptcy in a US court.
- The Japanese National Consumer Price Index (CPI) for July YoY came in better than expected.
- Market participants will keep an eye on the headlines surrounding China’s debt crisis and real-estate woes.
Asian stock markets trade lower on Friday. A stronger-than-expected US unemployment claims on Thursday indicated a robust labor market, which triggered some follow-through selling on Wall Street. Investors are concerned about the odds of another interest rate rise by the Federal Reserve (Fed) and China’s economic woes.
At press time, China’s Shanghai is down 0.06% to 3,162, the Shenzhen Component Index declines 0.54% to 10,570, and Hong Kong’s Hang Sang dips 1.12% to 18,120. India’s NIFTY 50 declined 0.31%, South Korea’s Kospi falls 0.62%, and Japan’s Nikkei loses 0.63%.
Evergrande, China’s second-largest real estate company filed for bankruptcy in a US court under Chapter 15 on Thursday. This report fuels the fear of a potential Chinese property catastrophe. Earlier this week, the Chinese House Price Index for July decreased to -0.1% from 0% prior. Furthermore, Fitch Ratings might reconsider China's A+ sovereign credit rating in the face of intensifying economic headwinds.
In Japan, the nation’s Statistics Bureau reported on Friday that the National Consumer Price Index (CPI) for July YoY came in at 3.3% against the market expectation of 2.5%. Meanwhile, the National CPI ex Fresh Food YoY matched the market consensus of 3.1%, and the National CPI ex Food, Energy rose to 4.3% figures versus 4.2% prior. This figure remained above the BOJ's inflation objective of 2% for 16 consecutive months. However, investors anticipate that the Bank of Japan (BoJ) would keep policy ultra-loose monetary policy.
Looking ahead, market players will digest the data and monitor the headlines surrounding China’s debt crisis and real-estate woes. In the light day of economic data release, risk sentiment will be the main driver in the market on Friday.