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Asian stocks drop on slow Chinese growth

Asian stocks drop on slow Chinese growth
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First Published: Tue, May 04 2010. 09 57 PM IST
Updated: Tue, May 04 2010. 09 57 PM IST
Singapore: Asian stocks fell, dragging a regional MSCI index to a more than five-week low, as China’s manufacturing growth slowed and concern mounted that an Australian tax will hurt earnings from resources.
China Zhongwang Holdings Ltd, a maker of aluminium products, slid 4.4% in Hong Kong as a Chinese purchasing managers’ index fell to a six-month low. BHP Billiton Ltd and Rio Tinto Ltd slumped for a second day in Sydney after Australia announced heavier taxes on resources earnings. Industrial and Commercial Bank of China Ltd lost 1.1% in Shanghai after the central bank ordered lenders to set aside more reserves.
The MSCI Asia Pacific excluding Japan Index lost 0.8% to 419.07 as of 6.19pm in Hong Kong, the lowest level since 25 March.
The gauge has increased 12% from its low this year on 8 February as better-than-estimated economic and earnings reports worldwide offset concerns a debt crisis in Europe and lending curbs in China will damp growth.
There’s some confusion given all the conflicting forces, such as the good news out of the US, ongoing Greece issues, tightening in China and the mining tax in Australia, said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors, which oversees around $90 billion (Rs4.01 trillion).
The underlying economic backdrop is fine and corporate profits are likely to rise strongly.
China’s Shanghai Composite Index fell 1.2% to the lowest level since 30 September. Taiwan’s Taiex Index sank 0.3%.
Hong Kong’s Hang Seng Index dropped 0.2%. Japan was closed for a holiday.
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First Published: Tue, May 04 2010. 09 57 PM IST
More Topics: Markets | Asia | Stocks | nikkei | Hang Seng |