China slowdown affects Asian stocks
Published 05/09/2012 | 05:42
Weaker-than-expected US manufacturing figures, just days after China announced its own production slowdown, have sent Asian stock markets down.
A measure of US manufacturing activity ticked down from 49.8 in July to 49.6 in August, according to the Institute for Supply Management, a private trade group.
It was the third straight month of a reading below 50, which indicates a contraction.
The US report comes amid shrinking factory activity in almost every major economy, including the 17-country eurozone, Britain, China, Japan and Brazil.
In China, factory activity fell last month to its lowest level in more than three years.
Japan's Nikkei 225 index fell 0.8% to 8,708.28. Hong Kong's Hang Seng lost 1% to 19,227.94 and South Korea's Kospi was down 1.5% at 1,879.25. Australia's S&P/ASX 200 shed 1% to 4,261.20.
Investors are remaining cautious while awaiting a meeting of the European Central Bank tomorrow, during which President Mario Draghi is expected to announce details of a new bond-buying program intended to help countries with high borrowing costs such as Spain and Italy.
Additionally, the weakness in US manufacturing may help persuade the Federal Reserve to announce new action after its meeting next week.