SEPTEMBER 7 (Reuters) — Asian shares got off on the back foot on Wednesday (September 2) after weak manufacturing activity reports from both the U.S. and China sent Wall Street reeling, while the dollar steadied after steep losses.
The Nikkei rose 0.6 percent to 18,275.60 in mid-morning trade after falling to a low of 17,857.30 soon after the market opened. The benchmark index tumbled 3.8 percent on Tuesday (September 1) after surveys showed China’s factory sector shrank for the sixth straight month in August.
Along with other global markets, Japanese stocks have been hit by worries of a China-led slowdown in the global economy. Still, the Nikkei is up about 5 percent this year, while the S&P 500 index has dropped 7 percent and the FTSEurofirst 300 index of top European shares is only up 1.8 percent.
Seoul shares fell in volatile trade by midday on Wednesday, while investors worried about slowdown in global economy after soft manufacturing activity reports from both the U.S. and China on Wednesday.
The Korea Composite Stock Price Index (KOSPI) was down 0.85 percent at 1,898.05 points, in the first 25 minutes of trading.
Australian shares fell 1.06 percent on Wednesday on broad based losses as the market tracked a sell-off in global equity markets and responded to an economic survey showing weakness in the Chinese economy.
The S&P/ASX 200 index fell 53.610 points to 5042.800 by 0334 GMT. The benchmark fell 2.1 percent on Tuesday, its lowest finish since Aug 24.
Investors were braced for volatile day in Chinese equities markets, the final trading day before a two-day holiday to commemorate the end of World War Two.
China’s major stock indexes opened down on Wednesday, despite pledges by a number of brokerages to increase their stock investment to support the market.
The CSI300 index fell 3.8 percent to 3,235.32 points at 01:34 GMT, while the Shanghai Composite Index lost 4.0 percent to 3,040.87 points.
One investor in Shanghai, surnamed Shi was concerned.
“The market dropped more than 100 after opening. What can I expect according to this trend? Our market doesn’t rise when foreign stock markets rise. Our market falls down after foreign stock markets drop, sometimes even drop ahead of them. How can I invest it?” he said.
China CSI300 stock index futures for September fell 2.1 percent, to 2,944.2, 291.12 points below the current value of the underlying index.
The Hang Seng index in Hong Kong was down 1.0 percent, to 20,977.93 points.
China’s central bank plans to tighten rules on trading of currency forwards from October, sources with direct knowledge of the matter told Reuters, in a move to curb speculation and volatility after last month’s sudden devaluation.