The Asian markets closed mostly in red on Wednesday as concerns about the impact of the weaker yuan weighed on the market. Asian lenders are seeing their loan books rapidly deteriorate across the region as China’s slowing economy dampens trade and hurts companies that had borrowed heavily from the banks. China has injected nearly $100 billion from its foreign exchange reserves into two policy banks, which lend based on government directives, to help spur the country’s sluggish economy. The injection suggests the central bank is trying to guide funds to go to the real economy, like exports and infrastructure construction. China’s economy, the world’s second-largest, expanded 7.4 percent last year, its weakest since 1990, and has slowed further this year, growing 7.0 percent in each of the first two quarters. Japan’s export growth slowed in July on reduced shipments of cars and electronics to Asia in a sign that the global demand outlook may be losing its luster. The 7.6 percent annual increase in exports in July was bigger than the median estimate for 5.5 percent annual growth expected, but still slower than June’s robust 9.5 percent year-on-year rise. Slowing export growth in July suggests overseas demand in third quarter may not be strong enough to help Japan’s gross domestic product recover from an annualized 1.6 percent contraction in April-June as exports slumped and consumers cut back spending, raising questions about the need for more official economic stimulus. Japan’s All Industries Activity Index rose to a seasonally adjusted 0.3%, from -0.5% in the preceding month.
Asian Indices Last Trade Change in Points Change in % Shanghai Composite 3,794.11 45.95 1.23 Hang Seng 23,167.85 -307.12 -1.31 Jakarta Composite 4,484.24 -26.24 -0.58 KLSE Composite 1,582.44 2.84 0.18 Nikkei 225 20,222.63 -331.84 -1.61 Straits Times 3,041.25 -8.40 -0.28 KOSPI Composite 1,939.38 -16.88 -086 Taiwan Weighted 8,021.84 -155.38 -1.90
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