Asian Shares Slide Ahead Of U.S. Inflation Data

Asian stocks ended mostly lower on Friday as investors avoided big bets ahead of U.S. consumer inflation data for November due this evening and the FOMC meeting next week.

At the meeting, the Federal Reserve could decide to double the pace of tapering its asset purchase program to $30 billion per month.

Evergrande’s default on U.S. dollar bonds as well as signs that several countries across the world are mulling stricter restrictions on movements to curb the spread of the Omicron variant of the coronavirus also dented sentiment.

Chinese shares ended lower amid uncertainty in the country’s property sector after Evergrande and Kaisa Group Holdings officially defaulted on their dollar debt. The developers were downgraded to “restricted default” by rating agency Fitch.

In another development, the People’s Bank of China has raised the reserve requirement ratio on banks’ foreign exchange deposits to 9 percent from 7 percent, effective December 15. This is the second time the central bank has raised the ratio this year.

The benchmark Shanghai Composite Index slipped 6.69 points, or 0.2 percent, to 3,666.35, while Hong Kong’s Hang Seng Index ended down 259.14 points, or 1.1 percent, at 23,995.72.

Japanese shares tumbled but posted their first weekly gain in three as Omicron worries ease. The Nikkei 225 fell 287.70 points, or 1 percent, to 28,437.77 but posted a 1.5 percent gain for the week. The broader Topix ended 0.8 percent lower at 1,975.48.

Tech stocks led losses, with Advantest, Tokyo Electron and Screen Holdings ending down between 1.3 percent and 1.8 percent. Medical equipment maker Terumo lost 2.3 percent and game maker Bandai Namco Holdings declined 2.9 percent.

Hitachi rose 2.2 percent on reports that the conglomerate is considering options to streamline its businesses, including the potential sale of its minority stake in a transportation unit.

Australian markets ended lower, dragged down by energy and technology stocks. Healthcare stocks also succumbed to selling pressure after three days of gains.

The benchmark S&P/ASX 200 Index dropped 31 points, or 0.4 percent, to 7,353.50 but recorded a weekly gain of 1.6 percent. The broader All Ordinaries Index ended down 21.50 points, or 0.3 percent, at 7,667.90.

Seoul stocks fell to snap a seven-day winning streak on concerns over Omicron’s economic impact. New coronavirus infections in South Korea stayed above 7,000 for the third consecutive day amid waning immunity and colder weather. The Kospi slid 19.34 points, or 0.6 percent, to close at 3,010.23.

Meanwhile, New Zealand shares rose notably amid a flurry of merger and acquisition activity. The benchmark NZX-50 Index climbed 77.85 points, or 0.6 percent, to 12,849.68.

Tourism Holdings jumped 6 percent after announcing plans to merge with its Australian counterpart Apollo Tourism & Leisure. Ebos surged 5.5 percent as shares came off a trading halt after an institutional share placement to buy medical device distributor LifeHealthcare.

Investors shrugged off the results of a survey showing a lower level of expansion in New Zealand’s manufacturing sector in November.

U.S. stocks closed lower overnight after gaining for three straight days, as investors reacted to new virus restrictions in the U.K. and declining jobless claims figures.

The tech-heavy Nasdaq Composite tumbled 1.7 percent, while the S&P 500 shed 0.7 percent and the Dow finished marginally lower.

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