Asia report: Markets plunge as fears for global economy rise

Markets in Asia were in the red across the board on Monday, as fears for the global economy took hold after a slew of negative data from both the US and Europe last week.

In Japan, the Nikkei 225 was down 3.01% at 20,977.11, as the yen weakened 0.23% against the dollar to last trade at JPY 110.17.

The broader Topix index was 2.45% lower by the close in Tokyo, settling at 1,577.41.

Of the major components on the country’s benchmark, automation specialist Fanuc was down 3.84%, and technology conglomerate SoftBank Group plunged 5.01%.

On the mainland, the Shanghai Composite lost 1.97% to 3,043.03, and the smaller, technology-heavy Shenzhen Composite slid 1.44% to 1,676.43.

South Korea’s Kospi was off 1.92% at 2,144.86, while the Hang Seng Index in Hong Kong fell 2.03% to 28,523.35.

China-focussed technology giant Tencent was one of the big losers in Hong Kong, falling 3.07% by end-of-play.

Of the blue-chip technology stocks on the Korean peninsula, Samsung Electronics shares were down 2.26%, and SK Hynix was off 4.2%.

Sentiment started negative and continued that way throughout the day in Asia, after a serious slide in shares in the US and Europe on Friday.

Wall Street markets were in the red amid fears that the country was headed for an economic recession, due to an inverted yield curve.

The spread between the US Treasury’s three-month and 10-year noted turned negative on Friday for the first time in more than 10 years - something many market watchers consider a potential signal for negative growth.

“At this stage, we are not predicting a US recession, but we have already concluded and published that the Fed’s tightening cycle is finished,” noted analysts at Commonwealth Bank of Australia.

Across the Atlantic, a slew of disappointing data from Europe on Friday added to the concerns for the world’s economic health.

Oil prices were lower as the region went to bed, with Brent crude last down 0.25% at $66.86 per barrel, and West Texas Intermediate off 0.1% at $58.98.

In Australia, the S&P/ASX 200 was down 1.11% at 6,126.20, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was off 0.3% at 9,519.31.

The down under dollars were mixed but little changed at the end of the day, with the Aussie last 0.09% against the greenback at AUD 1.4108, while the Kiwi weakened 0.01% against the same currency to NZD 1.4545.