Asia-Pacific markets experienced a decline on Monday, with Japan’s Nikkei 225 leading losses in the region following the weaker-than-expected U.S. jobs report on Friday. U.S. nonfarm payrolls rose by 142,000, missing the estimated 161,000 gain by economists, although the unemployment rate edged down to 4.2%, in line with expectations. Traders in Asia were looking to assess Japan’s revised GDP figures for the second quarter and China’s consumer price index report on Monday. Japan’s second-quarter GDP came in at 2.9% on an annualized basis, lower than the 3.2% expected by economists and the advance figure of 3.1%. Meanwhile, China’s inflation rate was expected to grow 0.7% in August from a year ago compared to 0.5% in July.
The Nikkei saw a significant 3% decline, accompanied by a 2.79% drop in the broad-based Topix. The Japanese yen also weakened by 0.2% against the U.S. dollar to 142.55, stepping back from a nine-month low achieved on Friday. Traders were closely watching equities as risk-off sentiment increased, with expectations of the unwind of the yen carry trade continuing. Kathy Lien, managing director of FX strategy at BK Asset Management, predicted some periods of aggressive selling in equities during the month. South Korea’s Kospi fell by 1.99% while the small-cap Kosdaq experienced a 1.72% drop. Australia’s S&P/ASX 200 declined by 0.6%, and Hong Kong Hang Seng index futures were lower at 17,443, below the HSI’s last close of 17,444.3.
In Hong Kong, Chinese electrical appliance manufacturer Midea Group announced the listing of 492.1 million shares on the Hong Kong stock exchange, with the offering priced between HK$52 and HK$54.80 per share. At the top end of this pricing range, the offering would be valued at HK$26.97 billion ($3.46 billion), making it the city’s largest listing in over three years. The previous week saw the S&P 500’s worst performance since March 2023, with the tech-heavy Nasdaq Composite recording its worst week since March 2022. During Friday’s session, the broad index fell by 1.73% while the Nasdaq declined by 2.55%, and the Dow Jones Industrial Average dropped by 1.01%.
Overall, the market sentiment in the Asia-Pacific region was affected by the weaker-than-expected U.S. jobs report and ongoing concerns about economic growth and inflation. The focus was on data releases from Japan and China, as well as developments in Hong Kong. Investors were cautious as they monitored the performance of major indices and currencies, particularly the yen and the U.S. dollar. The impact of global events and market uncertainties was evident in the significant declines witnessed in various stock exchanges across the region. Traders and analysts were closely watching for any signs of further volatility and potential market movements in the coming days.
