Morning Briefing: Weak Chinese data drags Asian equities lower

Morning Briefing: Weak Chinese data drags Asian equities lower

Morning Briefing: Weak Chinese data drags Asian equities lower Weak Chinese data drags Asian equities lower
China’s main index closed down more than 2 per cent Wednesday as investors digested the latest show of weakness in the world’s second largest economy.
The flash PMI data showed a 6.5 year low for manufacturing with a reading of 47.0 in September, below the 50.0 mark at which growth tips into contraction. Most Asian markets closed with losses; Tokyo reopens Thursday after a three-day holiday.

European indexes have shrugged off weak data so far and the major markets are trading with gains.

The TSX and Wall Street are expected to open higher after losses in Tuesday’s session.
 
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North America (previous session)
US Dow Jones 16,330.47 (-1.09 per cent) -0.79 per cent -4.25 per cent
TSX Composite 13,491.09 (-2.09 per cent) +0.13 per cent -10.81 per cent
 
Europe (at 5.40am ET)
UK FTSE 6,015.40 (+1.34 per cent) -2.78 per cent -9.90 per cent
German DAX 9,674.79 (+1.09 per cent) -4.44 per cent +0.83 per cent
 
Asia (at close)
China CSI 300 3,263.03 (-2.28 per cent) -9.10 per cent +35.99 per cent
Japan Nikkei 18,070.21 (-1.96 per cent) -7.03 per cent +10.72 per cent
 
Other Data (at 5.40am ET)
Oil (Brent) Oil (WTI) Gold Can. Dollar
49.61
(+1.08 per cent)
46.78
(+0.91 per cent)
1126.10
(+0.12 per cent)
U$0.7537
 
Aus. Dollar
U$0.7040
 
It’s not just China that’s a concern
Weak data from China has become a regular occurrence but there are other signs that the global economy is not gathering enough pace. Eurozone flash readings for services and manufacturing by Markit show September figures are lower than expected. Although there was still growth in the PMI at 53.9, it was down from the 54.3 in August and below expectations from a Reuters poll which predicted 54.1.

Taiwan has also raised concerns that its exports are weaker than hoped and the country’s central bank is considering cutting its interest rates which have been at 1.875 per cent since 2011.

Meanwhile a survey of Indian businesses shows sentiment has fallen for the third consecutive month. Although the index is still showing positive sentiment there is concern that weaker demand globally is holding back Indian companies’ growth.