Asian markets exhibited mixed results on Monday as investors reacted to the previous week’s performance on Wall Street, which had seen major indices nearing record levels. Hong Kong’s Hang Seng Index rose slightly by 0.1%, closing at 26,421.63. In contrast, the Shanghai Composite Index dipped 0.1% to 3,866.37, reflecting growing concerns about China’s economic outlook.
Analysts are expressing caution regarding China’s economic data for August. According to Lynn Song of ING Economics, “China’s economy continued to slide in August, with all key activity readings falling short of market forecasts once more.” Retail sales figures revealed a 3.4% increase, marking a 12-month low, down from 5.7% in July and 6.8% in June. The slowdown raises questions about the sustainability of China’s growth, particularly as U.S. President Donald Trump’s tariff policies disrupt established supply chains.
“The underlying flow is shifting. For years, Beijing leaned on exports as the carry trade that kept growth rolling even as property cracked,” noted Stephen Innes, managing partner at SPI Asset Management. He emphasized that the tariffs have significantly impacted this trade dynamic.
The Australian market also faced challenges, with the S&P/ASX 200 index losing nearly 0.2% to 8,851.70. Meanwhile, South Korea’s Kospi gained 0.4% to reach 3,408.54. Stock trading in Japan was halted for a national holiday.
Wall Street’s Impact
Wall Street concluded its trading on Friday with the S&P 500 experiencing a slight decline of 0.1% from its all-time high achieved the previous day. The Dow Jones Industrial Average fell by 273 points, or 0.6%, closing at 45,834.22. The Nasdaq Composite managed a modest gain, adding 0.4% to finish at 22,141.10.
Investors are closely watching the Federal Reserve’s upcoming meeting, where expectations are high for an interest rate cut, which would be the first of its kind this year. If the anticipated cuts do not materialize, analysts warn that the market might react negatively.
In the bond market, the yield on the 10-year Treasury rose slightly to 4.06%, recovering from earlier declines. Energy markets also saw movement, with benchmark U.S. crude increasing by 37 cents to $63.06 per barrel. Meanwhile, Brent crude, the international standard, rose by 36 cents to $67.35 per barrel.
In currency trading, the U.S. dollar inched up to 147.67 Japanese yen from 147.65 yen, while the euro remained unchanged at $1.1732.
The fluctuations in both Asian and U.S. markets highlight the complex interplay of domestic economic indicators and international trade policies, with investors remaining vigilant as they navigate potential changes in monetary policy and economic data.
