Dipo Olowookere
By Investors Hub
Asian stocks succumbed to heavy selling pressure on Wednesday as lingering concerns over US-China trade talks, political uncertainty in Spain and fears that a snap election in Italy will turn into referendum on the country’s euro membership sapped investors’ appetite for risk.
Chinese shares ended lower following reports that the Trump administration is considering imposing a hefty 25 percent tariff on the USD 50 billion worth of Chinese goods even as a U.S. delegation is set to travel to Beijing for talks to resolve the dispute.
The benchmark Shanghai Composite index dropped 79.02 points or 2.53 percent to finish at 3,041.44 while Hong Kong’s Hang Seng index ended down 427.79 points or 1.40 percent at 30,056.79.
Japanese shares fell sharply as global bourses extended losses and the yen gained ground against the dollar and euro on fears over the stability of euro zone. The Nikkei average slumped 339.91 points or 1.52 percent to 22,018.52, while the broader Topix index closed down 1.46 percent at 1,736.13.
Automakers Toyota, Honda Motor and Nissan Motor as well as banks Mitsubishi UFJ Financial and Sumitomo Mitsui Financial lost 2-3 percent. Gaming giant Nintendo soared 4.3 percent after announcing new Pokemon games.
Investors ignored preliminary figures showing that Japan’s retail sales increased at a faster-than-expected pace in April. Retail sales climbed 1.6 percent year-over-year in April, faster than the 1.0 percent rise in March.
Australian shares fell notably amid broad-based selling as investors rushed to safe-haven assets such as U.S. Treasuries. The S&P/ASX 200 index dropped 28.90 points or 0.48 percent to 5,984.70 while the broader All Ordinaries index ended down 27.90 points or 0.46 percent at 6,093.80.
The big four banks dropped 1-2 percent and miners Rio Tinto and South32 fell over 1 percent amid weakness in metal and iron ore prices while gold and healthcare stocks rose on defensive buying. Evolution Mining advanced 1.3 percent and CSL rose over 1 percent.
Energy stocks closed broadly lower after crude oil prices fell for the fifth straight session overnight.
In economic news, total number of building approvals issued in Australia decreased at a faster-than-expected pace in April, data from the Australian Bureau of Statistics revealed.
