Asian equities saw a mixed bag as the adverse effects of rising Delta virus cases were visible on global economies. The Chinese market also slowed down against expectations.
Retail sales expanded 8.5% in July year-on-year and industrial output was up 6.4%, according to figures released by Beijing’s statistics bureau, with both figures below analyst estimates.
Lockdowns and other movement restrictions brought in to combat the country’s recent coronavirus outbreaks have been blamed for hampering economic performance, as well as a series of deadly floods.
“The spread of domestic outbreaks and natural disasters have affected the economy of some regions, and economic recovery remains unstable and uneven,” National Bureau of Statistics spokesman Fu Linghui told a press briefing.
But he added that “the national economy continues to stabilise and recover” overall.
Raymond Yeung, chief economist for Greater China at ANZ Banking Group, said the figures “suggest the economy is losing steam very fast”.
Surging infections linked to the delta variant of the coronavirus “also adds extra risk to August’s activities,” he added.
Iris Pang, ING’s chief economist for Greater China, told AFP industrial output was weak “because of the semiconductor chip shortage that has affected production”.
A shortage of chips has also been sending shock waves through the global economy, squeezing supplies of everything from cars to headphones.
There were dips in Hong Kong, Sydney, Singapore, Taipei and Jakarta, while Shanghai, Wellington and Manila were up.
In Tokyo, the benchmark Nikkei 225 index dropped nearly two percent in morning trade despite government data showing a 0.3 percent rise in GDP — slightly more than expected after a surge in virus infections and new restrictions.
Mizuho Securities said markets were “expected to be weighed down by drops in US consumer sentiment and a stronger yen”.
