Asian shares sink on revived worries over recession, China

  • article

Bangkok, Dec. 21(BNA): Shares retreated in Asia on Friday after a mixed day on Wall Street as optimism over signs the Federal Reserve may temper its aggressive interest rate hikes was replaced by worries the economy might be headed for a recession.

A U.S measure of inflation that’s closely watched by the Federal Reserve eased in October, raising questions over the central bank’s determination to keep raising interest rates to tame price increases.

Activity in American manufacturing contracted in November for the first time since May 2020, according to the Institute for Supply Management. The report also showed that prices are falling, reports AP.

Slower growth due to tighter monetary policies has slowed new orders and order backlogs, “which saw manufacturing conditions contracting for the first time since June 2020,” Jun Rong Yeap of IG said in a report.

Signs of weakening trade, especially for export dependent economies in Asia, have deepened worries over slowing growth in China and its implications for the global economy.

Tokyo’s Nikkei 225 index lost 1.7% to 27,750.22 and the Hang Seng in Hong Kong declined 0.7% to 18,612.49. The Kospi in Seoul shed 1.4% to 2,445.86.

Signs of weakening trade, especially for export dependent economies in Asia, have deepened worries over slowing growth in China and its implications for the global economy.

Tokyo’s Nikkei 225 index lost 1.7% to 27,750.22 and the Hang Seng in Hong Kong declined 0.7% to 18,612.49. The Kospi in Seoul shed 1.4% to 2,445.86.

AHN