Asian stocks fall, focus on China concerns: markets wrapping

Asian stocks fall, focus on China concerns: markets wrapping

(Bloomberg) — Asian stocks are set to decline Monday after stocks on Wall Street capped a weak week on the back of a decline, and a real estate slump in China dampened market sentiment.

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Stock futures fell in Australia, Japan and Hong Kong, as did a barometer of US-listed Chinese companies. Country Garden Holdings, once China’s largest private developer by sales, is at risk of joining a slew of defaulters and the country’s latest economic data is likely to show little sign of a pickup in growth.

Meanwhile in Japan, the yen is trading near the closely watched 145 level against the dollar amid depreciation pressures that have investors waiting for any signs that the government may intervene as it did last year. The currency weakened for five straight days through Friday while the dollar strength index advanced over the past four weeks as treasury yields rose.

Friday’s US trading session saw the tech giants drop, and mixed economic data left stocks weak and struggling for direction. In choppy trading, the S&P 500 closed at a one-month low with a drop of just 0.1%. The Nasdaq 100 posted its longest weekly losing streak this year, hovering around 15,000. Nvidia Corp. — which more than tripled in 2023 — extended its four-day decline to 10%.

One-time bond king Bill Gross said the stock and Treasury bulls are wrong because both markets are “overvalued.”

The former chief investment officer of Pacific Investment Management Co. told Bloomberg Television that the fair value of the 10-year Treasury yield is about 4.5%, compared to the current level of 4.15%.

Meanwhile, Friday’s economic reports did little to change swap market bets that the Federal Reserve would hold off on raising interest rates next month. Traders also continued to expect the central bank to signal that its fight against inflation is far from over.

Consumer inflation expectations as measured by the University of Michigan unexpectedly eased in early August, despite higher gasoline and grocery costs. Meanwhile, producer prices rose more than expected last month, mainly due to increases in certain service categories.

Oil fell on Monday, after posting its longest streak of weekly gains since mid-2022. Multiple reports predicting an increase in demand gave new impetus to the rush built on increasing risks of supply disruptions and widening Saudi production cuts.

Main events this week:

  • China’s medium-term lending, retail sales, industrial production, fixed asset investment, net foreign exchange settlement, Tuesday

  • Japanese Industrial Production, GDP, Tue

  • UK Unemployment Claims, Unemployment, Tue

  • US retail sales, manufacturing empire, business stocks, cross-border investing, Tuesday

  • Minutes from the Reserve Bank of Australia’s monetary policy meeting, Tuesday

  • Minneapolis Federal Reserve Bank President Neel Kashkari speaks on Tuesday

  • Real estate prices in China, Wed

  • Eurozone Industrial Production, GDP, Wed

  • UK CPI, Wed

  • FOMC Meeting Minutes, New Housing, Industrial Production, Wed

  • US Initial Jobless Claims, Conf. The board’s leading indicator, Thursday

  • Eurozone CPI, Friday

  • Japanese CPI, Friday

Some of the major movements in the markets:


  • S&P 500 futures were up 0.2% as of 8:05 a.m. Tokyo time. The S&P 500 fell 0.1% on Friday

  • Nasdaq 100 futures rose 0.2%. The Nasdaq 100 fell 0.7%.

  • Nikkei 225 futures fell 0.4%

  • Australian S&P/ASX 200 futures fell 0.4%

  • Hang Seng Index futures fell 1.2%.


  • The Bloomberg Dollar Spot Index has not changed

  • The euro was little changed at $1.0942

  • The Japanese yen was little changed at 144.92 per dollar

  • The external yuan was little changed at 7.2602 per dollar

  • The Australian dollar was not changed much at $0.6495

Digital currencies

  • Bitcoin fell 0.3 percent to $29,309.26

  • Ether fell 0.8% to $1,837.78



This story was produced with help from Bloomberg Automation.

– With the help of Rita Nazareth.

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© 2023 Bloomberg LP

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