Asia-Pacific stocks ended Tuesday’s session in a mixed performance, as investors grappled with the impact of US trade protectionist policies and a sudden contraction in China manufacturing.
Despite gains in some markets, Indian benchmarks including the Sensex continued to lose ground amid concerns at home and weak global signals.
The Caixin/S&P Global Manufacturing purchasing managers’ (PMI), which measures the factory activity for China in May, revealed that it had shrunk at its highest rate since September 2022.
The PMI fell sharply to 48.3, below the median estimate by Reuters of 50.6, and was down from 50.4 in March.
The report showed a sharper drop in export orders, highlighting the impact that US tariffs have on the second largest economy of the world.
The economic pressure was accompanied by a deterioration in the US-China trading relations.
China responded to US allegations that it violated an interim trade agreement on Monday by blaming Washington instead for not upholding the deal.
The exchange between these two superpowers was a sign of deterioration in their negotiations.
The European Union has added to global trade concerns by criticizing US President Donald Trump for his stated intent to double the steel tariffs up to 50%. An EU spokesperson said that this move would “undermine” the EU’s own negotiations with the US, and the EU was “prepared to implement countermeasures.”
Trump announced earlier that the tariffs on US steel and aluminium exports would be doubled to 50% from Wednesday.
Hong Kong is leading, Japan remains flat and Australia rises
Hong Kong’s Hang Seng Index, despite the headwinds and ending the day at 23,512.49, was the regional leader.
Mainland China’s CSI 300 closed at 3,852.01, up 0.31% despite choppy trade.
The Nikkei index, which is the benchmark for the Nikkei, ended the day unchanged at 37,446.81. Meanwhile, the Topix, the more diversified index, fell by 0.22%, to 2,771.11.
S&P/ASX200, the benchmark for Australia’s stock market index, rose 0.63% and finished at 8,466.70 after briefly reaching a four-month high in earlier session.
Australia’s current account deficit for the first three months of 2025 was 14.7 billion Australian dollars.
This was a significant improvement over the AU$16.3 billion deficit that had been recorded during the last quarter, which economists surveyed by Reuters predicted.
South Korean markets are closed on election day.
Asia-Pacific Steelmakers’ performance was mixed, indicating the impact of an impending US steel tax hike.
As of 2:46 p.m., shares of Chinese state owned manufacturers Chongqing Iron & Steel (Chongqing), Angang Steel (Angang), and Maanshan Iron & Steel (Maanshan) were each down by 1.56%, 0.85%, and 3.51%, respectively.
Singapore time. JFE Holdings, however, bucked this trend and moved up by 0.42%.
Tata Steel, Jindal Steel and Power, and Jindal Steel and Power all saw their shares flatten out. JSW Steel, India, however, had seen a 0.12% decline.
Sensex continues to lose ground amid pressures
The Indian Stock Markets suffered significant losses Tuesday, marking their third consecutive day of declines.
This downturn has been attributed to weakening global signals, increasing concerns about stretched valuations and a notable outflow of foreign capital.
BSE Sensex closed at 81.373.75 against an opening of 81.492.50 and then fell nearly 800 points or 1 percent to reach an intraday minimum of 80.575.09.
The NSE Nifty 50, which opened at 24786.30 compared to its previous closing of 24,716.60 also fell by nearly 1 percent and reached an intraday minimum of 24,502.15.
The Sensex ended the day 636 points or 0.78 per cent lower, at 80.737.51.
The Nifty50 settled at 24542.50 points down by 174 or 0.70 percent.
Earlier, at 1:33 p.m. Indian Standard Time the benchmark Nifty50 index had fallen 0.64% while the BSE Sensex fell 0.88%.
Both the BSE Smallcap and Midcap indexes ended with a lower value, down 0.52 and 0.07 respectively.
US market undercurrents
US Futures have shown some resilience despite the cautionary tone in Asia. However, they do show a slight dip.
It followed Monday’s positive trading start on Wall Street for June.
The S&P 500 closed at 5,935.94 overnight, while the Nasdaq Composite gained 0.67%, ending at 19,242.61. Meanwhile, the Dow Jones Industrial Average rose 35.41 or 0.08% to 42,305.48.
The post Asian markets closed: Hong Kong led gains, Nikkei was flat; Sensex fell over 630 pts. may change as new information becomes available.
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