Asian Stocks Mixed As China's Economy Weakens

Asian stock markets were mixed Tuesday, August 15, 2023, after China reported weak July consumer and business activity and its central bank cut a key interest rate to shore up the struggling economy.

Photo Insert: The People’s Bank of China cut its interest rate on one-week loans to banks.

Shanghai and Hong retreated while Tokyo and Sydney gained. Oil prices rose, Joe McDonald reported for the Associated Press (AP).

The Shanghai Composite Index fell 0.3% to 3,169.18 after official data showed growth in Chinese consumer spending and factory output slowed more than expected. The People’s Bank of China cut its interest rate on one-week loans to banks.

The Hang Seng in Hong Kong lost 0.8% to 18,622.55. The Nikkei 225 in Tokyo gained 0.8% to 32,314.90 and Sydney’s S&P-ASX 200 rose 0.5% to 7,310.30. Markets in Korea and India were closed for the holidays.

New Zealand, Singapore, and Jakarta gained while Bangkok declined.

On Wall Street, the benchmark S&P 500 index gained 0.6% to 4,489.72 on Monday ahead of an update on US retail spending that traders hope will help to avert a possible recession. The Dow Jones Industrial Average edged up 0.1% to 35,307.63. The Nasdaq composite gained 1.1% to 13,788.33.

Chinese leaders are trying to shore up flagging economic growth without resorting to an across-the-board stimulus they worry will push up debt they think is already dangerously high.

Growth slid to 0.8% over the previous quarter in the three months ending in June from the January-March period’s 2.2%.

Growth in retail sales declined to 2.5% over a year earlier in July from the previous month’s already low 3.1%, official data showed Tuesday. Growth in factory output and investment also decelerated despite promises by the ruling Communist Party to support entrepreneurs.

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