Asian stocks fall as a result of Chinese inflation, with the Consumer Price Index (CPI) in the spotlight.
Weak Chinese inflation readings exacerbated concerns about lackluster demand in the region’s major export destination. The focus now turns to U.S. inflation statistics later in the day.
By 01:45 ET (0545 GMT), the Shanghai Shenzhen CSI 300 had fallen 1.2%, while the Shanghai Composite had fallen 0.6%.
Industrial equities were among the worst performers in the country as data showed producer price inflation fell to a 17-month low in July.
The reading also suggests lackluster demand for commodities exported to China, a significant Asian economic driver.
Following Wall Street’s overnight weakness, Asia’s tech stocks fell heavily. Micron Technology’s poor estimate sent the NASDAQ Composite index down 1.2%. (NASDAQ: MU).
Hong Kong’s tech-heavy Hang Seng index lost 2.2%. Tencent Holdings Ltd (HK:0700), Alibaba Group Holding Ltd (HK:9988), and Baidu Inc (HK:9888) all saw 1-3% declines.
The unfavorable lead-in countered Lenovo Group’s (HK:0992) good quarterly earnings. Hong Kong-listed shares declined 0.6%.
Japanese markets fell 0.7%, and Australian stocks fell 0.5%. Taiwan’s tech-heavy index fell 0.7%.
Now, attention turns to Wednesday’s U.S. inflation figures. While June’s reading is predicted to be lower than May’s, it will likely remain above 40-year highs.
This would probably cause the Federal Reserve to raise interest rates, which would make it harder to get money and hurt the stock market.
