Asian stocks declined, with a regional measure falling to its lowest level in more than four years, as concern about China’s growth outlook continued to fan a global selloff.
The MSCI Asia Pacific excluding Japan Index tumbled 2 percent to 374.51 as of 4:04 p.m. in Hong Kong, heading for its lowest close since October 2011, after sinking 7.1 percent last week. Markets in Tokyo are closed Monday for a holiday. Turmoil in China’s markets rippled around the world in the first week of 2016 as the securities regulator scrapped an equity circuit breaker after just four days and the central bank set a weaker yuan fix for eight days in a row, escalating fears of a global currency war.
China’s Shanghai Composite Index slumped 5.3 percent to the lowest close in almost four months, while the Hang Seng China Enterprises Index of mainland stocks traded in Hong Kong declined 3.9 percent. The offshore yuan erased early losses after China’s central bank kept the currency’s daily fixing stable for the second day in a row.
The stock market’s extreme market swings this year and a sliding yuan have revived concern over the Communist Party’s ability to manage an economy set to grow at the weakest pace since 1990. China’s consumer price index rose 1.6 percent in December from a year earlier, the National Bureau of Statistics said on Saturday. That followed a gain of 1.5 percent in November. The producer price index fell 5.9 percent, extending its record run of declines to 46 months.
South Korea’s Kospi index and Australia’s S&P/ASX 200 Index both fell 1.2 percent. New Zealand’s S&P/NZX 50 Index lost 0.9 percent. Hong Kong’s Hang Seng Index sank 2.8 percent. Singapore’s Straits Times Index dropped 2.1 percent. Taiwan’s Taiex index slipped 1.3 percent.
E-mini futures on the Standard & Poor’s 500 Index fluctuated on Monday after the underlying gauge sank 6 percent last week. Concern about China’s market turmoil overshadowed a Labor Department report on Friday showing that employers added 292,000 workers to payrolls in December, exceeding the highest estimate in a Bloomberg survey and putting the gain for all of 2015 at 2.65 million.
Source : Bloomberg