Asia stocks sink on global growth worries
BANGKOK (AP) — Asian stock markets tumbled Tuesday as weak economic data, falling commodity prices and big losses on Wall Street shook investors. A deadly bombing in the U.S. also rattled confidence.
The sell-off in markets was triggered by the Chinese government’s report Monday that growth in the world’s second-largest economy slowed to 7.7 percent in the first quarter from 7.9 percent in the final quarter of last year. Growth was expected to accelerate slightly to 8 percent.
The report stoked worries about the strength of China’s economy at a time when U.S. economic data has disappointed and Europe remains embroiled in its government debt crisis. It also pummeled oil and commodity prices.
A bombing at the finish line of the Boston Marathon that appeared timed for maximum casualties further fanned anxiety. Three people were killed and more than 140 injured. No-one has claimed responsibility.
“China GDP data spooked investors into thinking that the world’s second largest economy is slowing at a faster rate than anticipated,” said Evan Lucas of IG Markets in Melbourne. “All these gyrations on commodity and currency markets were compounded further by the dreadful events in Boston.”
Japan’s Nikkei sank 1.1 percent to 13,135.50, retreating from last week’s multiyear highs. The yen gained strength as investors unloaded metals and plowed into the safe-haven Japanese currency.
Hong Kong’s Hang Seng tumbled 0.9 percent to 21,576.20. South Korea’s Kospi fell 1 percent to 1,901.90. Australia’s S&P/ASX 200 shed 0.6 percent to 4,937.50. Benchmarks in Indonesia, Taiwan and mainland China also fell.
On top of the disappointing data from China were figures on Monday showing a drop in U.S. homebuilder confidence. A separate report showed weak manufacturing in the Northeast. On Friday, the Commerce Department said retail sales fell 0.4 percent in March from the previous month, reinforcing views that the U.S. recovery is losing some steam.
On Wall Street, the Dow Jones industrial average fell 1.8 percent to close at 14,599.20. The S&P 500 index fell 2.3 percent to 1,552.36. The Nasdaq composite fell 2.4 percent to 3,216.49. It was Wall Street’s worst day so far in 2013.
Concerns that Cyprus and other troubled European countries may sell gold to raise cash have also weighed on prices for precious metals. On Tuesday, gold continued its descent, dropping more than $21 early in Asia to $1,339.50 an ounce. Gold has fallen sharply over recent trading sessions. It stood at $1,689 at the beginning of the year.
Mining and resource shares were among those hard hit in Asia. Hong Kong-listed Jiangxi Copper Co. slid 4.6 percent. PetroChina, China’s largest oil and gas producer, shed 1.7 percent. Energy Resources of Australia lost 4.9 percent.
The sharp decline in gold and fears about global growth reverberated throughout commodity markets. Benchmark oil for May delivery dived $2.10 to $86.58 per barrel in electronic trading on the New York Mercantile Exchange. The contract dropped $2.58, or 2.8 percent, to finish at $88.71 a barrel on Monday.
In currencies, the euro rose slightly to $1.3038 from $1.3036 late Monday in New York. The dollar fell to 96.99 yen from 97.18 yen.
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