Asian stocks fall amid fears of slow growth; Dollar remains near three-week low By Reuters

By Alun John

HONG KONG (Reuters) – Asian stocks gave up some of their recent gains in cautious trading on Wednesday as the dollar retreated from its three-week low as concerns over slowing global growth in several markets once again weighed on the minds of traders.

The largest MSCI index of Asia-Pacific stocks outside of Japan fell 0.40%, beating a three-week high reached the previous day.

Over the past two weeks, the regional benchmark has regained much of the ground lost a few weeks earlier when global markets fell, frightened by the possibility that the US Federal Reserve would move closer to cutting its purchases of ‘assets.

However, on Tuesday, Chinese blue chips fell 0.44% and Hong Kong fell 0.5%, as concerns over slowing growth in China remained a drag.

The day before, China reported that factory activity grew at a slower pace as the services sector collapsed into the contraction, showing that China’s current period of weakness continues into the third quarter, ” Mansoor Mohi-uddin, Chief Economist, Bank of Singapore, wrote in a note.

Mohi-uddin added that “the authorities may become more open to providing further monetary and fiscal stimulus to prevent the economy from experiencing a deeper slowdown for the rest of the year.”

Australian stocks fell 0.58%, slightly reducing earlier losses, after figures showed gross domestic product (GDP) rose 0.7% in the June quarter.

ANZ analysts said ahead of the release that the numbers would be “largely old news. The most pressing question is how big the GDP contraction will be in the September quarter.”

However, it gained 0.89%, boosted by data showing capital spending by Japanese companies rose in the second quarter, the first such increase since the start of the pandemic.

Fears of slower growth are not unique to China. Overnight, Wall Street ended slightly lower on Tuesday, after U.S. consumer confidence fell to its lowest level in six months in August, as spike in COVID-19 infections and rising inflation took hold. dampened the economic outlook.

However, the slightly mixed end of August did not alter the strong monthly performance of the three major US indices, aided by the conciliatory tone of Fed Chairman Jerome Powell’s speech last Friday. ()

As Powell has also suggested that an improvement in the labor market is one of the main prerequisites for the Fed to reduce its asset purchases, much attention is also being drawn to the U.S. payroll data due on Friday.

Yields on the benchmark edged up in Asian Hours to 1.3256% from the US close of 1.302%, but were still roughly in the middle of the range they traded in the past two years. last months.

In forex markets, the, which measures the greenback against six rivals, edged up after falling to a three-week low the previous day.

Oil was flat, at $ 68.49 per barrel and $ 71.72 per barrel, did not change much that day, having ended August with their first monthly losses since March.

An OPEC + meeting, during which the main producers will decide whether they wish to continue with their plan to add supply, is due to take place later today. [O/R]