Asia: Stocks slide after Japanese GDP falls unexpectedly

Asian stocks plunged after an unexpected decline in Japanese economic growth in the third quarter.

Japanese gross domestic product (GDP) fell an annualised 1.6% in the third quarter, compared to a fall of 7.3% in the previous quarter, surprising analysts who had expected 2.2% growth.

The report fuelled concerns about the health of the world’s third largest economy, sending global stocks lower.

Japan’s Nikkei finished down 2.96% while Hong Kong’s Hang Seng dropped 1.21% and the Shanghai composite fell 0.19%.

“Japan’s renewed weakness comes at a time when the global economy is already facing several other headwinds, such as the threat of deflation (especially in the Eurozone), together with the pressures being seen in several emerging markets, such as Russia, Brazil and also China,” said chief economist Simon Smith at FX Pro.

It comes after the Bank of Japan has boosted stimulus measures in the hopes of boosting the economy.

The data sent Japan’s Nikkei down 2.96% while Hong Kong’s Hang Seng dropped 1.21% and the Shanghai composite fell 0.19%.

In China, bad loans jumped by the most since 2005 in the third quarter, China Banking Regulatory Commission said in a statement on 15 November.

Company-wise Halliburton slumped after agreeing to buy Baker Hughes.

Sumitomo Mitsui Financial Group dropped in the wake of reports Citigroup plans to give the company the right of first refusal this month to buy its Japanese consumer-banking business.