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Asia stocks down due to global growth concerns

April 18. 2013 2:34AM
Associated Press

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(AP) Asian stock markets fell Thursday as accumulating evidence of weakness in the global economy kept investors on the sidelines.

Markets were also weighed down by some disappointing U.S. corporate earnings and worries about a possible drop in demand for Apple's iPod and iPhone.

Japan's Nikkei 225 index fell 0.4 percent to 13,330.27. Hong Kong's Hang Seng shed less than 0.1 percent to 21,559.59. South Korea's Kospi dropped 0.8 percent to 1,909.14. Australia's S&P/ASX 200 slid 1.3 percent to 4,941.70.

Investors in China and Hong Kong are feeling cautious due to a bird flu outbreak in eastern China and the rapid rise of Chinese government debt.

"Funds are still staying with those stock markets that are under monetary easing mode," said Kwong Man Bun, the chief operating officer at KGI Securities in Hong . "Investors remain on sidelines to wait for signals that recent corrections have come to an end. So far this signal is not clear."

European economic indicators this week also have raised concerns: Germany reported a drop in investor confidence while car sales have plummeted across the region. Labor market figures for the U.K. were also negative, suggesting the British economy is unlikely to stage a significant recovery in coming months.

The International Monetary Fund on Tuesday lowered its outlook for the world economy, predicting that government spending cuts will slow U.S. growth and keep the euro currency countries in recession this year.

The week got off to a bad start Monday, when China said its economic growth slowed in the first three months of the year to 7.7 percent, below the 8 percent level anticipated by markets. That caused U.S. stocks, energy and other commodities to plunge. Gold fell the most in 30 years.

On Wednesday, stock markets in the U.S. again turned sour on disappointing earnings from Bank of America. The bank has been mired in mortgage-related lawsuits related to its acquisition of Countrywide, which played a major role in the U.S. financial crisis by issuing subprime loans. Traders also began to worry about Apple Inc.'s sales after a supplier hinted at a slowdown in iPhone and iPad production.

Those worries come on top of reports of weak hiring and retail sales, suggesting the U.S. economy may be cooling off.

On Wednesday, the Dow Jones industrial average fell 0.9 percent to close at 14,618.59. The S&P 500 index dropped 1.4 percent to 1,552.01. The Nasdaq composite declined 1.8 percent to 3,204.67.

Benchmark oil for May delivery was down 14 cents to $86.54 a barrel in electronic trading on the New York Mercantile Exchange. The contract dropped $2.04, or 2.3 percent, to close at $86.68 in New York on Wednesday.

In currencies, the euro rose to $1.3054 from $1.3014 late Wednesday in New York. The dollar rose to 98.15 yen from 97.84 yen.


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Associated Press

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