Most Asian stocks sank Tuesday after Chinese trade data pointed to more signs of stress in the global economy, though news of Europe’s fresh lifeline to Spain offers some support.
South Korea’s Kospi KR:SEU -0.53 percent and Australia’s S&P/ASX 200 index AU:XJO -0.57 percent lost 0.4 percent each, while China’s Shanghai Composite Index CN:000001 -0.53 percent fell 0.6 percent and Hong Kong’s Hang Seng Index HK:HSI -0.25 percent eased 0.3%.
Japan’s Nikkei Stock Average JP:100000018 -0.02 percent also came off earlier highs but managed to finish the morning session with a 0.3 percent gain.
Most markets in Asia turned south after data showed China’s import growth slowed more than expected in June, while the trade surplus widened sharply in June, as exports picked up.
“The basic trend is its still slowing, and the implication is that Friday’s [second-quarter gross domestic product] number will be quite weak,” said Andrew Sullivan, a principal sales trader at Piper Jaffray in Hong Kong.
“It’s obvious that the global economic slowdown is having an impact on China, and China isn’t going to be the savior of the world,” Sullivan said.
Australian resource firms were notable decliners following the drop in imports from key trading partner China.
Global miners BHP Billiton Ltd AU:BHP -1.11 percent BHP -0.94 percent declined 0.5%, and Rio Tinto Ltd AU:RIO -1.65 percent RIO -1.81 percent RIO -1.81 percent RIO -1.81 percent CN:000001 -0.53 percent lost 0.8 percent while copper producer PanAust Ltd AU:PNA -3.03 percent retreated 2.1%.
Losses for property developers dragged in Hong Kong, where China Resources Land Ltd HK:1109 -2.14 percent sank 1.8%, while in Shanghai, Gemdale Corp. CN:600383 -3.74 percent fell 2 percent and Poly Real Estate Group Co. CN:600048 -3.85 percent tumbled 3.5%.
In Seoul, some shipping-related stocks led the index lower. Shares of Hyundai Mipo Dockyard Co. lost 2%, and Samsung Engineering Co. gave up 1.4%.
Gains for defensive stocks supported broader gains in Tokyo.
Seven & I Holdings Co. JP:3382 +1.35 percent SVNDF +1.66%, owner of the 7-Eleven brand of convenience stores, rose 1.6%, FamilyMart Co. JP:8028 +1.52 percent FYRTF +7.39 percent gained 2.1%, and brewer Kirin Holdings Co. JP:2503 +0.97 percent KNBWY +0.89 percent added 1.7%.
In the telecom space, wireless operator Softbank Corp. JP:9984 +0.45 percent SFTBF +0.76 percent put on 1.1%, and KDDI Corp. JP:9433 +1.32 percent KDDIF +3.13 percent gained 1.5%.
Energy firms made ground despite a pull-back in oil futures in electronic trading after Norway’s government decided to avert an industry lockout by stopping a labour strike and imposing arbitration. Read more on Norway’s oil-industry action.
Tokyo-listed JX Holdings Inc. JP:5020 +3.11 percent jumped 3.9%, and Inpex Corp. JP:1605 +1.02 percent IPXHY -0.36 percent rose 1.2%.
Shares of Mitsubishi UFJ Financial Group Inc. JP:8306 -0.26 percent MTU -0.41 percent eased 0.3 percent in Tokyo after the Nikkei reported that its core banking unit had suspended two traders suspected of prior involvement in the manipulation of the London interbank offered rate. Read more on MUFG trader suspensions.
The performance in Asia came after US stocks sealed a three-session losing streak Monday, hurt as Spain’s bond yields jumped above the key 7 percent level, reigniting euro-zone concerns. Read more on the US session.
In an effort to address Spain’s fiscal crisis, European finance ministers reached a deal in Brussels late Monday that will make 30 billion euros ($36.9 billion) in aid available to the nation by the end of the month. Read more on the EU meeting.
Sullivan said that while the agreement represented “a good deal for Spain,” markets across Asia were little moved by the decision. -By Virginia Harrison