Asia: Stocks fall on weak Chinese data and RBA interest rate cut

Stocks in Asia were mostly down on Tuesday following Australia's interest rate cut and weak data from China.

The Shanghai composite index fell 4.06% and Hong Kong's Hang Seng was down 1.31% due to worse-than-expected data.

Manufacturing Purchasing Managers’ Index (PMI) published by HSBC and Markit fell to 54.2 in April from 54.3 one month earlier, missing forecasts of an increase to 54.7 points.

Michael van Dulken from Accendo Markets said that "concerns that recent Chinese market gains on monetary stimulus hopes may have been excessive" also drove stocks down.

In corportate news, China Construction Bank fell 5.07% and real estate company China Poly Group lost 6.91%.

Australia's ASX was down 0.02% despite the Reserve Bank's decision to cut its benchmark interest rate by 25 basis points to 2%. This was the second cut this year, driven by an increase in house prices, strong currency and falling ore prices.

The move sent shares in BHP Billiton and Rio Tinto lower. BHP Billiton fell 1.12% and its rival Rio Tinto lost 0.95%.

Connor Campbell from Spreadex said miners were "in somewhat of a slump this morning after the Australian central bank squashed interest rates to their lowest ever level in order to combat the country’s post-mining boom headache".

The RBA raised concerns about ongoing economic weakness and its impact in house prices.

Also on Tuesday, Australian trade deficit fell to $1.32bn in March from $1.61bn the month before, against expectations of $1bn.

On the bright side, Japanese Nikkei 225 rose slightly by 0.06% helped by gains from Wall Street.