World stocks tumble on weak China trade, lower estimate of Japan growth
Teresa Cerojano, The Associated Press
Published Monday, March 10, 2014 6:31AM EDT
MANILA, Philippines -- Asian stock markets sank Monday, battered by weak Chinese trade and a reduced estimate for Japan's economic growth. European markets were mostly higher.
Shares in Malaysia Airlines tumbled on news of the weekend disappearance of one its jets en route to Beijing.
Japan's Nikkei 225 closed down 1 per cent at 15,120.14 and China's Shanghai Composite plunged 2.9 per cent to 1,999.06. Hong Kong's Hang Seng dropped 1.8 per cent to 22,264.93.
Markets were also down in Australia, Taiwan, South Korea and Southeast Asia.
Data released on the weekend showed China's exports fell by an unexpectedly large 18 per cent in February, possibly denting hopes trade will help drive the slowing economy while communist leaders push ambitious reforms.
China's official 2014 economic growth target of 7.5 per cent, announced last week by Premier Li Keqiang, assumes trade also will grow by 7.5 per cent. But customs data show combined imports and exports so far this year have shrunk by 4.8 per cent.
Meanwhile, Japan reported Monday a record current account deficit for January, and lowered its economic growth estimate for the October-December quarter to 0.7 per cent from 1 per cent.
Andrew Sullivan of Kim Eng Securities in Hong Kong said sentiment was affected by the weak data from China and from Japan.
However, "there are technical factors behind the China data which means it is not as bad as the first look suggests," he said in a market commentary.
Some analysts say exports in February last year might have been overstated by exporters inflating sales figures to evade currency controls and bring extra money into China.
In early European trading, Britain's FTSE 100 rose 0.4 per cent to 6,738.95. France's CAC-40 gained 1.1 per cent to 4,415.79 and Germany's DAX added 0.2 per cent to 9,373.67.
Futures augured subdued trading on Wall Street. Dow Jones futures and S&P 500 futures were both little changed.
Shares of Malaysian Airlines System Bhd., the holding company of Malaysia Airlines, were down 4 per cent on the Kuala Lumpur stock market, tempering a 10 per cent fall in early trading.
One of its Boeing 777 jets went missing early Saturday morning on a flight from Kuala Lumpur to Beijing with 239 people on board. Search and rescue efforts in the South China Sea have not yet identified any debris.
Shares of other Asian airlines also fell. Cathay Pacific shed 0.4 per cent and Qantas Airways lost 1.8 per cent.
In the oil market, benchmark U.S. crude for April delivery was down $1.21 at $101.37 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.02 on Friday to settle at $102.58.
In currencies, the euro rose to $1.3894 from its previous close of $1.3875. The dollar rose to 103.34 yen from 103.16 yen.