2024-08-05 06:27:40
Fears of a recession in the United States, tensions in the Middle East and the rise of the yen mainly explain the falls in the indicators observed this Monday in the stock markets of Japan, Taiwan and South Korea.
Published on: 05/08/2024 – 08:27
2 minutes
Asian stock markets are in free fall on Monday, with indices in Tokyo, Seoul and Taiwan experiencing dizzying falls against the backdrop of fears of a recession in the United States and a surge in the yen, notes Agence France Presse.
The Japanese capital’s flagship Nikkei index, which had already fallen by 5.8% on Friday, sank by 12.28% to 31,500.03 points around 05:35 GMT, en route to the biggest drop in points in its history. . The broader Topix index fell by 12.38% to 2,223.55 points. Taiwan fell by 8%, as did Seoul.
Chinese stock markets fell more modestly, with Hong Kong’s Hang Seng index falling by 1.8%, Shanghai’s composite index by 1.1% and Shenzhen’s by 1.5%.
« The causes? A US jobs report that missed the mark so badly that not only caused jaws to drop, but also stocks and yields “, on Wall Street, according to Stephen Innes of SPI Asset Management.
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Fears of escalating conflicts in the Middle East are also adding to the market volatility, on the heels of threats from Iran and its allies to Israel, blamed by the Islamist group Hamas and Lebanon’s Hezbollah for the deaths on Wednesday. by Hamas leader Ismaïl Haniyeh.
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Even before the even worrisome job figures published on Friday in the United States, the Tokyo Stock Exchange had experienced a dark day, with the Nikkei experiencing its most dizzying fall in points since 1987 and the second sharpest drop in its history.
Several factors played a role, such as a disappointing US report on manufacturing activity in July and a fall in technology stocks in the face of doubts about the growth prospects of the sector. ” However, the immediate trigger for this risk aversion seems to be an unexpected increase in interest rates » announced Wednesday by the Bank of Japan, according to Dilin Wu, strategist at Pepperstone, ” this decision hit the Japanese stock market like a bolt from the blue”.
This increase in interest rates contributed to the appreciation of the yen, also supported by interventions by the Japanese central bank on the foreign exchange market. However, this exchange rate movement is harmful for Japanese export companies which have benefited from the fall of the Japanese currency.
Japanese banks were hit particularly hard and Nintendo shares fell 16% after the Japanese video game giant saw its net profit fall in the first quarter, and maintained conservative forecasts on Friday while its next console was not expected for many month.
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