Asian Shares Retreat On Growth Worries

Asian stocks ended broadly lower on Friday amid growth worries, as a slew of surveys showed regional manufacturing activity stalled in June and many companies were hit by supply disruptions caused by China’s strict COVID-19 lockdowns.

China’s Shanghai Composite Index closed 0.3 percent lower at 3,387.64 despite upbeat factory activity data from a private survey.

The Caixin/Markit manufacturing Purchasing Managers’ Index for June rose to 51.7 from 48.1 last month. Markets in Hong Kong were closed for a holiday.

Japanese shares ended at a nearly two-week low after the Bank of Japan’s quarterly tankan business sentiment survey showed sentiment among the country’s large manufacturers worsened in the April-to-June period. Dismal manufacturing and unemployment data also stoked concerns about the economic outlook.

The Nikkei 225 Index tumbled 1.7 percent to 25,935.62, extending losses for a third straight session on worries about a possible recession in the United States. The broader Topix closed 1.4 percent lower at 1,845.04.

Heavyweight Fast Retailing lost 4 percent, while tech shares such as Advantest, Screen Holdings and Tokyo Electron fell 3-4 percent. Travel-related stocks ended broadly lower after a sharp rise in COVID-19 cases in Tokyo.

Mitsubishi Corp and Mitsui & Co both fell over 5 percent as Russia moved to create a firm that will take over all rights and obligations of the Sakhalin Energy Investment Company amid Western sanctions.

The two Japanese trading companies and Shell Plc hold just under a 50 percent stake in Sakhalin Energy Investment Co.

Seoul stocks ended lower for a third day to hit a 20-month low after the release of weak data. South Korea’s trade deficit hit a record high in the first half of the year, while manufacturing activity expanded at a slower pace in June, separate reports revealed.

The Kospi slumped 1.2 percent to settle at 2,305.42, with chipmakers and chemical stocks leading losses.

Market heavyweight Samsung Electronics dropped 1.4 percent to reach a fresh 52-week low, while SK Hynix and LG Energy Solution both lost around 4 percent.

Australian markets ended modestly lower as falling commodity prices pulled down mining and energy stocks.

The benchmark S&P/ASX 200 Index dipped 0.4 percent to 6,539.90, extending losses for a third session. The broader All Ordinaries Index closed 0.4 percent lower at 6,720.40.

Miners BHP, Rio Tinto and Fortescue Metals Group dropped 2-3 percent, while energy stocks such as Santos and Woodside Energy lost 3-4 percent. Fintech firm Openpay surged almost 21 percent after saying it would exit the U.S. market.

The Reserve Bank of Australia meets on Tuesday and analysts expect the central bank to lift the cash rate by another 50 basis points.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 Index fell 1.1 percent to 10,753.16, extending losses for a third straight day.

U.S. stocks fell overnight to wrap up a grueling second quarter after data showed U.S. household spending slowed in May amid historically high inflation and elevated interest rates.

The S&P 500 dropped 0.9 percent, bringing its losses for the first half of the year to 21 percent. The Dow dipped 0.8 percent and the tech-heavy Nasdaq Composite fell 1.3 percent.

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