Stock markets in Asia experienced a decline on Thursday following a third consecutive day of losses on Wall Street as the ongoing rally showed signs of weakening. Oil prices saw an increase of nearly $1, and U.S. futures displayed mixed results.
In Japan, the benchmark Nikkei 225 initially showed gains but ended up trading flat at 38,104.86. This came as purchasing manager indexes indicated a deteriorating economic situation in Japan for both manufacturing and services. The overall composite PMI compiled by au Jibun Bank dropped to a two-year low.
China also witnessed a downturn in its markets, with Hong Kong’s Hang Seng declining by 1% to 20,555.04, and the Shanghai Composite index falling by 0.5% to 3,286.17. Meanwhile, in Seoul, the Kospi decreased by 0.2% to 2,593.57, and Australia’s S&P/ASX 200 saw a slight uptick of 0.1% to 8,225.90. Taiwan’s Taiex experienced a 0.5% loss, and the Sensex in India dropped by 0.2%.
Market sentiment was impacted by concerns regarding China’s economic outlook and the upcoming U.S. presidential election, according to Stephen Innes of SPI Asset Management. On Wednesday, the S&P 500 declined by 0.9% to 5,797.42, ending a six-week winning streak, the longest of the year.
The pressure from rising Treasury yields has been weighing on stocks, making investors cautious about paying high prices for stocks that already appear overvalued. The Dow Jones Industrial Average fell by 1% to 42,514.95, while the Nasdaq composite tumbled by 1.6% to 18,276.65. Big Tech stocks, including Nvidia and Apple, were among the main contributors to the market’s decline.
In company news, McDonald’s shares dropped by 5.1% due to an E. coli outbreak linked to its Quarter Pounder burgers, affecting individuals across several states. Meanwhile, Boeing reported a loss of over $6 billion for the latest quarter, and its factory workers opted to continue a six-week strike, leading to a 40% decline in Boeing’s stock this year.
Despite the overall market decline, some companies saw positive movements. AT&T reported stronger profit than expected, leading to a 4.6% increase in its stock, while Texas Instruments climbed 4% after reporting better-than-anticipated profit and revenue.
In the commodities market, U.S. benchmark crude oil gained 91 cents to $71.68 per barrel, and Brent crude, the international standard, surged 86 cents to $75.82 per barrel. Currency-wise, the dollar slipped to 152.22 Japanese yen, and the euro rose to $1.0790.
In summary, the Asian markets saw a decline following losses on Wall Street, influenced by concerns over China’s economic future and the upcoming U.S. election. Rising Treasury yields and company-specific issues contributed to the overall market decline, while positive movements were observed in specific companies and commodity prices. Investors are keeping a cautious eye on market developments amid ongoing economic uncertainties.