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Thursday, December 08, 2022

Asian stocks fall as manufacturing weakens in China

BEIJING ( Associated Press) – Asian stock markets sank on Thursday after weakening Chinese manufacturing and Russian shelling around the Ukrainian capital shook hopes of progress in peace talks.

Shanghai, Hong Kong and Tokyo declined, while Seoul gained. Oil fell over $7 a barrel in New York but remained above $100.

Wall Street’s benchmark S&P 500 index fell 0.6% on Wednesday after US economic growth was weaker than expected.

Russian forces opened fire on areas near Kyiv and another city on Wednesday after Moscow said it would reduce operations there to boost confidence. The negotiators were meeting in Turkey to try to end the five-week-old war.

Stephen Innes of SPI Asset Management said in a report, Russia is “putting cold water on the headlines of constructive ceasefire talks.”

The Shanghai Composite Index fell 0.1% to 3,263.19 after the index of Chinese manufacturing activities y fell to a five-month low after Shanghai and two small industrial cities were closed to fight the coronavirus outbreak.

The Hang Seng in Hong Kong fell 0.8% to 22,052.49.

“The near-term outlook remains extremely uncertain,” Julian Evans-Pritchard of Capital Economics said in a report. “Even if the outbreak is brought under control soon, it will still take some time for the economy to get back on track.”

The Nikkei 225 in Tokyo was down 0.5% at 27,889.09 and Sydney’s S&P-ASX 200 rose 0.2% to 7,530.80.

The Kospi in Seoul rose 0.4% to 2,757.65 after data on improved February industrial output.

India’s Sensex rose less than 0.1% to open at 58,708.37. New Zealand and Jakarta rose, while Singapore and Bangkok declined.

On Wall Street, the S&P 500 fell to 4,602.45 after Commerce Department data showed the US economy Growth grew at an annualized pace of 6.9% in the last quarter of 2021, below forecast.

The Dow Jones Industrial Average slipped 0.2% to end at 35,228.81. The Nasdaq Composite fell 1.2% to end at 14,442.27.

Talks between Russia and Ukraine have led to a rally in the market this week was showing progress.

Uneasiness over a possible disruption in Russian oil and gas exports added to concerns about higher US interest rates and a Chinese economic slowdown.

On Thursday the Commerce Department is due to release its personal income and spending report for February. The Labor Department will release US employment data for March on Friday.

In energy markets, benchmark US crude fell to $100.65 a barrel from $7.17 in electronic trading on the New York Mercantile Exchange. The contract rose $3.58 to $107.82 on Wednesday. Brent crude, the price base for international oil trade, fell by $6.29 to $105.15 a barrel in London. It rose $3.22 to $113.45 from the previous session.

President Joe Biden is preparing to order the release of up to 1 million barrels of oil per day from US reserves, according to two people familiar with the decision. It will come closer to closing the US production gap than in February 2020, before the coronavirus hit hard.

The dollar rose to 122.23 yen from Wednesday’s 121.78 yen. The euro rose from $1.1159 to $1.1160.

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