World Economy

Asian Stocks Swoon

Asian Stocks SwoonAsian Stocks Swoon

Chinese shares lurched lower in late-trading on Tuesday, depressing Asian stock markets which succumbed to nerves over the possibility of a falling yuan and a deadly bomb explosion in Thailand.

A positive handover from Wall Street did little to help sentiment; the tech-heavy Nasdaq led gains with a 0.9% rise overnight, as investors scooped up battered biotech plays, while the Dow Jones Industrial Average and the S&P 500 notched up 0.4 and 0.5%, respectively, on the back of positive homebuilder data,CNBC reported.

China’s Shanghai Composite index accelerated the pace of decline in the afternoon session, closing down 6.12% at its lowest level since August 7, as concerns over the yuan eclipsed data which showed monthly home prices up for a third straight month in July, indicating that country’s all-important property sector may be finally bottoming.

Prior to the market open, the People’s Bank of China set the midpoint rate at 6.39 per dollar. However, the yuan fell against the greenback, slipping modestly to last change hands at 6.40.

Among the mainland’s other indexes, the blue-chip CSI300 and the smaller Shenzhen Composite plummeted 6.2 and 6.6%, respectively. Hong Kong’s Hang Seng index tracked the losses in its mainland peers to move down 1.1%, touching a near six-week trough.

The utilities and industrial sectors were among the hardest-hit, with Jiangsu Linyang Electronics, Baoding Tianwei Baobian Electric and Jiangxi Ganyue Expressway losing the daily maximum allowable of 10% each. China Shipbuilding Industry and China Shenhua Energy also closed down 10% each, despite news that Beijing may be close to announcing broad plans to reform its state-owned enterprises this month.

Thailand’s benchmark SET index slid as much as 3%, after a deadly bomb explosion took place at one of the capital’s most prominent shrines on Monday.

The tourism and leisure sub-index plunged 7.1% on the back of concerns that the latest attack could hurt the country’s crucial tourism sector. According to newswires, Hong Kong’s government has issued a “red alert” advisory against non-essential travel to Thailand.

Meanwhile, the Thai baht lost as much as 0.5% to 35.55 against the US dollar marking its lowest since April 2009.