SYDNEY : Asian stock markets wallowed at one-month lows on Tuesday and the yuan struggled as China cut interest rates as another round of disappointing data underscored its economic malaise.
MSCI's broadest index of Asia-Pacific shares outside Japan edged down 0.1 per cent to 509.12, not far from a one-month low on Monday of 506.3 as worry about China's frozen property sector swept across regional markets. "The chain reaction triggered by slumping new home sales may lead to a rising number of developers' defaults, a sharp contraction of government revenue, falling demand for construction materials, declining wages... weaker consumption, and faltering financial institutions."
Shares in under-pressure developer Country Garden bounced 5 per cent to HK$0.83. The once-sound developer is struggling to make debt repayments and its woes are a chilling signal for the broader market. In January 2020 the shares traded at HK$13. "The export news was heartening and bodes well for Japan’s continued trade competitiveness," said John Vail, chief global strategist at Nikko Asset Management in Tokyo, though he cautioned that domestic consumption indicators were soft.
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