U.S. Markets closed

Asia stocks kept in check by China, Japan slowdown

Pamela Sampson, AP Business Writer

BANGKOK (AP) -- Asian stock markets fell Monday after a slowdown in Japan's growth gave investors another reason to worry about the health of the global economy.

Japan released data showing the economy grew at a slower-than-expected annual rate of 1.4 percent in April-June as Europe's debt crisis and the strong yen weighed on the country's powerhouse export sector. That was a sharp drop from a revised 5.5 percent in the previous quarter.

The news comes on top a slew of reports out of Asia that point to a region losing momentum.

On Friday, China released weaker-than-expected trade data. Export growth in July plunged to just 1 percent from the previous month's 11.3 percent, well below forecasts of about 5 percent.

Meanwhile, Hong Kong and Singapore, both Asian financial centers that are highly exposed to global trade, reported weak second-quarter growth. And India's industrial output fell a worse-than-expected 1.8 percent in June amid a manufacturing and investment slump.

Japan's Nikkei 225 was flat at 8,891.90. Hong Kong's Hang Seng fell 0.2 percent to 20,099.86 and South Korea's Kospi lost 0.6 percent to 1,934.96. Shares in mainland China and the Philippines also fell. Australia's S&P/ASX 200 bucked the trend, rising 0.3 percent to 4,290.90.

Stan Shamu of IG Markets in Melbourne said investors remained frustrated by slowing export growth out of China, which also reported Friday a less-than-expected decline in inflation.

But the dismal report helped fuel speculation that China's central bank was preparing to act with some type of measure to spur business activity.

Shamu said in an email commentary that "easing talk is likely to ramp up over coming sessions and this could support markets and limit downside."

Even though it came on the heels of a raft of bad economic news, Japan's growth figures were taken in stride.

"The market has become accustomed to mild disappointment," said Benjamin Collett at Louis Capital Markets in Hong Kong.

Japan's export sector continues to be thrashed by a stubbornly strong yen. Mazda Motor Corp. lost 1.1 percent. Isuzu Motor Corp. lost 1 percent.

Elsewhere, Australia's Newcrest Mining jumped 3.8 percent after reporting its full-year profit rose 23 percent due to rising gold prices. JB Hi-Fi Ltd. soared 7.8 after the Australian retailer said it expected sales to grow in the year ahead.

Chinese construction shares fell. Shanghai-listed Fujian Cement Inc. fell 3.5 percent. Hong Kong-listed China National Building Material Co. lost 1.2 percent. Poly Real Estate Group fell 3.4 percent in Hong Kong.

Benchmark oil for September delivery was up 52 cents to $93.40 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 49 cents to end at $92.87 per barrel in New York on Friday.

In currencies, the euro fell to $1.2290 from $1.2294 in New York on Friday. The yen fell slightly to 78.27 yen from 78.26 yen.