Asian stocks mixed after China reports slower growth
BANGKOK (AP) — Stocks were mixed in Asia on Monday after China reported its economy grew at an 8.1% annual rate in 2021, though growth slowed to half that level in the last quarter. .
Tokyo, Shanghai and Sydney rose, while Hong Kong and Seoul fell.
The weakness of the Chinese economy towards the end of 2021 prompts suggestions that Beijing should step in to support growth with interest rate cuts or by injecting money into the economy through spending on public works. .
Shortly before the release of growth data, China’s central bank announced a cut in average lending rates to commercial banks to the lowest level since 2020.
“Economic momentum remains weak amid repeated virus outbreaks and a struggling property sector,” Capital Economics’ Julian Evans-Pritchard said in a commentary. He expects Chinese policymakers to maintain relatively tight limits on loans and control credit growth.
“The bottom line is that policy easing is likely to cushion the economic downturn rather than cause a rebound,” he said.
Slowdown in activity in China, the largest economy in the region, can hamper growth across the region. Lockdowns and other precautions imposed to combat coronavirus outbreaks can also exacerbate shortages of key parts and components, adding to shipping and supply chain challenges.
The Shanghai Composite Index gained 0.3% to 3,532.24, while Hong Kong’s Hang Seng fell 0.6% to 24,220.61.
South Korea’s Kospi fell 1.1% to 2,889.98 after North Korea’s layoff two suspected ballistic missiles into the sea on Monday morning in its fourth weapons launch this month, the South Korean military said, in an apparent bid to demonstrate military might amid stalled diplomacy with states States and pandemic border closures.
In Tokyo, the Nikkei 225 rose 0.7% to 28,318.54 as the government reported machinery orders rose in November, private investment and manufacturing activity improved during a lull in outbreaks of coronavirus. Orders from shipbuilders jumped 170%.
Australia’s S&P/ASX 200 edged up 0.1% to 7,398.70.
On Friday, the S&P 500 gained 0.1% to 4,662.85, surging in the final minutes of trading after falling about 1% earlier in the day. The tech-heavy Nasdaq posted a 0.6% gain, closing at 14,893.75. The Dow Jones Industrial Average fell 0.6% to 35,911.81.
Small company stocks also rebounded from an early plunge. The Russell 2000 Index rose 0.1% to 2,162.46.
A rally in tech stocks, along with gains in energy and other sectors, helped offset declines in banks and elsewhere in the market at a time when investors were mostly focused on a mix of reports on corporate profits and discouraging retail sales data.
The mixed end capped a choppy week of trading on Wall Street that deepened the market’s slide in January. The benchmark S&P 500, which climbed 26.9% in 2021, is now about 2.8% below the all-time high it hit on Jan. 3.
The Commerce Department reported Friday that retail sales fell 1.9% in December. after Americans cut spending in the face of product shortages, rising prices, and the appearance of the omicron variant.
It was the latest in a series of economic reports this week that raised concerns about inflation and its impact on businesses and consumer spending.
Rising prices have prompted companies to pass on more costs to consumers. Consumers cut spending in department stores, restaurants and online due to rising prices and supply shortages.
Concerns about the persistent rise in inflation are also prompting the Federal Reserve to reduce its bond purchases and consider raising interest rates sooner and more often than Wall Street expected less than a year ago.
The 10-year Treasury yield remained stable at 1.79%.
The price of U.S. crude oil rose 40 cents to $84.22 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, it rose 2.1%, helping to lift energy stocks.
Brent crude added 19 cents to $86.25 a barrel.
The US dollar fell from 114.18 yen to 114.42 Japanese yen. The euro remained unchanged at $1.1417.
AP Business Writer Joe McDonald in Beijing contributed.