Asia report: Markets fall further after week of rate hikes

Stock markets were in the red across the board in Asia again on Friday, with Australia’s bourse putting in a particularly poor performance on return from a holiday.

In Japan, the Nikkei 225 was down 0.58% at 27,153.83, as the yen weakened 0.53% against the dollar to last trade at JPY 143.14.

Automation specialist Fanuc was down 0.87%, fashion firm Fast Retailing lost 1%, and technology conglomerate SoftBank Group slid 2.02%.

The broader Topix index was off 0.24% by the end of trading in Tokyo, settling at 1,916.12.

On the mainland, the Shanghai Composite was 0.66% weaker at 3,088.37, and the technology-heavy Shenzhen Component lost 0.97% to 11,006.41.

Analysts at Nomura poured cold water on sentiment around China during the day, slashing their growth forecast for the country to 4.3% in 2023, from a previous 5.1%.

The broker blamed Beijing's ongoing, strict zero-Covid policies as being a major risk to growth should any further infections flare up.

It came after Goldman Sachs also trimmed its expectations for China’s economy next year, to 4.5% from 5.3%, earlier in the week.

South Korea’s Kospi slid 1.81% to 2,290.00, while the Hang Seng Index in Hong Kong was behind by 1.18% at 17,933.27.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics managing gains of 0.18%, while SK Hynix was 2.91% lower.

Oil prices were lower as the region entered the weekend, with Brent crude futures last down 2.96% on ICE at $87.78 per barrel, and West Texas Intermediate losing 3.35% on NYMEX to $80.69.

“Japan’s intervention in the currency markets, in a move designed to prop up the yen, was one which nonetheless failed to lift the gloom in mixed Asian trading overnight,” said Interactive Investor head of market Richard Hunter of the day’s moves in the region.

“Quite apart from any number of concerns emanating from China, ranging from consumer confidence to an ailing property sector with restrictive lockdowns also in place, the reverberations of central bank actions continue to rattle investors on a global basis and the Asian region is no exception.”

In Australia, the S&P/ASX 200 tumbled 1.87% to 6,574.70, as traders in Sydney returned from a holiday on Thursday to mark the passing of Queen Elizabeth II.

Fresh data on both the manufacturing and service sectors showed accelerating growth in the sunburnt country, with S&P Global’s flash manufacturing purchasing managers’ index (PMI) rising to 53.9 in September from 53.8 in August.

The services PMI from the same outfit, meanwhile, rose to 50.4 from 50.2, with both readings remaining above the 50-point level that separates expansion from contraction.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was down 0.72% at 11,434.82, although tourism operator THL gained 3.8% after the country’s competition regulator said it would allow its acquisition of road touring competitor Apollo.

Both of the down under dollars were weaker against the greenback, with the Aussie last off 1.27% at AUD 1.5240, and the Kiwi retreating 1.32% to NZD 1.7321.

Reporting by Josh White at Sharecast.com.