Asia-Pacific markets ended lower Friday as global investors watched for key events in the coming week, including the US Federal Reserve’s interest rate decision and the US presidential election.
The drop came after Wall Street’s significant losses Thursday, with the Nasdaq Composite and S&P 500 logging their largest single-day declines in nearly two months amid high uncertainty.
China’s latest manufacturing data offered some mixed signals. The Caixin China manufacturing purchasing managers’ index (PMI) rose to 50.3 in October, exceeding analysts’ median estimate of 49.7 and rebounding from 49.3 in September. This PMI reading, above 50, suggests an expansion in Chinese manufacturing for October. However, China’s CSI 300 index, which rose over 1% during intra-day trading, closed slightly lower at 3,890.02. Hong Kong’s Hang Seng Index bucked the trend, finishing 0.93% higher at 20,505.38.
Japan’s Nikkei 225 recorded a sharp loss of 2.63%, closing at 38,053.67, while the Topix Index fell 1.52% to 2,644.26. These losses extend from the previous session when the Bank of Japan kept its interest rate at 0.25%, disappointing some market watchers. South Korea’s Kospi dropped 0.54% to 2,542.36, while the smaller Kosdaq slid 1.89% to 729.05. Taiwan’s benchmark index, the Taiwan Weighted, declined 0.18% to close at 22,780.08, as Typhoon Kong-rey struck the island with heavy rains and winds.
Australia’s S&P/ASX 200 also ended in the red, down 0.5% to 8,118.8, as third-quarter data showed a slowdown in the annual producer prices index, rising by 3.9% year-over-year, a decrease from the previous quarter’s 4.8%.
The volatile day in Asia mirrored US market trends. The S&P 500 and Nasdaq Composite both saw significant declines on Thursday, with the S&P 500 dropping 1.86% to 5,705.45 and the Nasdaq Composite down 2.76% to 18,095.15, both marking their steepest losses since early September. Investors in the U.S. have been reacting to heightened caution surrounding both the upcoming Fed decision and election results, factors that also impacted US bond markets.
The US Treasury yield on the 10-year note climbed to 4.30%, nearing a four-month high, while in the UK, bond yields rose for a third day amid concerns that a new budget could increase inflation and strain growth. Oil prices saw an uptick, with Brent crude rising 2.7% to $74.77 per barrel following reports of potential escalations in the Middle East. Meanwhile, gold prices edged up 0.2% to $2,750 an ounce as markets globally remained on edge awaiting critical economic data and political developments.
