Asia’s major stock indexes dipped on Thursday as investor caution remained high, with worries over the US economy the main concern.
In what has been a data-packed week so far, traders have been scouring for clues to the economic health of the US and its labour market, with markets on edge after Tuesday’s weak manufacturing figures and Wednesday’s mixed labour data.
On Thursday, investors will focus attention on a reading on the US services industry and jobless claims data, but the week’s key concern will be Friday’s hotly anticipated August report for non-farm payrolls.
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Japan’s Nikkei share average fell in choppy trade, weighed down by a stronger yen and losses in semiconductor-related stocks, with traders also eyeing Friday’s US payroll figures.
The Nikkei closed at its lowest level since August 14, dropping 1.05% to 36,657.09, its third consecutive session of losses. The broader Topix erased early gains to end 0.48% lower at 2,620.76.
The yen touched a one-month high of 143.20 earlier in the session, and has strengthened 1.8% so far this week.
A stronger local currency tends to hurt exporter shares as it decreases the value of overseas profits in yen terms when firms repatriate them to Japan.
Among exporters, automaker Toyota Motor slumped 2.2% and tech and entertainment conglomerate Sony Group was down 1.5%.
Chip-related stocks extended losses in the afternoon session, tracking a slump in AI chip firm Nvidia and other US technology shares on Wednesday.
China stocks were subdued while Hong Kong markets slipped, as lacklustre performances in oil and coal sub-indexes offset upbeat sentiment towards the property sector.
A broad risk-off mode ahead of a likely US rate cut and the lack of market-moving catalysts also weighed on sentiment.
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The Shanghai Composite Index rose 0.14%, or 4.04 points, to 2,788.31, while the Shenzhen Composite Index on China’s second exchange was up 0.52%, or 7.98 points, to 1,529.62.
China’s blue-chip CSI300 index edged 0.17% higher with, earlier in the session, its financial sector sub-index up by 0.16%, the consumer staples sector rising 0.3% and the healthcare sub-index gaining nearly 1%.
The real estate sub-index jumped 1.71% following a report that Chinese regulators have proposed reducing rates on outstanding mortgages nationwide by a total of about 80 basis points to ease homeowners’ burden.
Concerns over weakening oil demand dragged China and Hong Kong-listed energy stocks lower. Hong Kong’s Hang Seng Mainland Oil & Gas Index dropped more than 3% to suffer the most significant losses.
Chinese H-shares listed in Hong Kong – stocks belonging to companies from the Chinese mainland – fell 0.87% to 6,080.59, while the Hang Seng Index was down 0.08%, or 13.04 points, at 17,444.30.
Elsewhere across the region, in earlier trade, there were also losses in Seoul, Singapore and Mumbai. Sydney, Wellington, Taipei, Manila and Bangkok all rose.
US Dollar on Defensive
The MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.25%, subdued after having tumbled nearly 3% during a three-day losing streak.
Futures indicated European bourses would open in the red, with Eurostoxx 50 futures down 0.25%, German DAX futures 0.3% lower and FTSE futures down 0.25%.
In the currency market, the dollar stayed on the defensive, as odds of larger rate cuts rose. The Japanese yen was one of the biggest beneficiaries of investors’ flight from risky assets.
Treasury yields were calm in Asian hours on Thursday after diving in the previous session. Benchmark 10-year note yields were at 3.765%, while two-year note yields were little changed at 3.764%.
In commodities, Brent crude futures rose 0.37% to $72.97 after dropping 1.42% in the previous session. US West Texas Intermediate crude futures were up 0.38% at $69.46 after sliding 1.62% on Wednesday.
Key figures
Tokyo – Nikkei 225 < DOWN 1.05% at 36,657.09 (close)
Hong Kong – Hang Seng Index < DOWN 0.08% at 17,444.30 (close)
Shanghai – Composite > UP 0.14% at 2,788.31 (close)
London – FTSE 100 > UP 0.05% at 8,274.04 (0934 BST)
New York – Dow > UP 0.09% at 40,974.97 (Wednesday close)
- Reuters with additional editing by Sean O’Meara
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