Asian stock markets were predominantly in decline on Wednesday, continuing the negative momentum from Wall Street’s sell-off overnight. Markets in Australia, Japan, South Korea, Hong Kong, Singapore, and Taiwan all experienced significant losses. Weak commodity prices, global economic growth concerns, and uncertainties regarding the pace of U.S. interest rate cuts contributed to the downturn. Notably, Asian markets had also closed mostly lower on Tuesday.Investors reacted to data indicating a continued decline in U.S. manufacturing activity in August, raising renewed concerns about the economic outlook.While the U.S. Federal Reserve is expected to lower rates at its upcoming meeting later this month, there is some debate regarding the extent of the rate cuts. The CME Group’s FedWatch Tool indicates a 63.0 percent probability of a quarter-point rate cut and a 37.0 percent chance of a half-point rate cut.### Australian MarketAustralian shares also fell sharply on Wednesday, extending losses from the previous session. The benchmark S&P/ASX 200 dipped below the 8,000 mark, driven by negative cues from Wall Street and widespread sectoral weakness, particularly in mining and energy stocks amid plummeting commodity prices. Data revealing slower-than-expected economic growth in Australia for the three months ending in June and a continued contraction in manufacturing activity in August further weighed on sentiment.The S&P/ASX 200 Index fell by 160.10 points, or 1.98 percent, to 7,943.10, after reaching a low of 7,939.40 earlier. The broader All Ordinaries Index declined by 169.90 points, or 2.04 percent, to 8,152.80. Australian stocks had closed slightly lower on Tuesday.In the mining sector, BHP Group lost over 1 percent, Rio Tinto fell nearly 2 percent, and Fortescue Metals dropped almost 4 percent. Mineral Resources remained flat.Oil stocks were generally down as well, with Origin Energy edging down 0.2 percent, Santos losing over 2 percent, Woodside Energy declining almost 2 percent, and Beach Energy falling nearly 3 percent. In the tech sector, Afterpay owner Block and Zip both lost more than 2 percent each, WiseTech Global fell nearly 2 percent, and Xero declined over 1 percent. Appen, however, surged almost 6 percent.Among the big four banks, Commonwealth Bank, National Australia Bank, and Westpac each fell almost 2 percent, while ANZ Banking was down over 1 percent.In the gold mining sector, Northern Star Resources and Newmont each fell more than 1 percent, Evolution Mining dropped almost 2 percent, Gold Road Resources declined more than 4 percent, and Resolute Mining slipped over 3 percent.Economically, Australia’s GDP grew by a seasonally adjusted 0.2 percent in the second quarter of 2024, matching expectations and accelerating from 0.1 percent in the previous quarter. Year-over-year, GDP increased by 1.0 percent, also in line with forecasts but down from 1.1 percent in the prior three months.Meanwhile, the services sector in Australia expanded at a faster pace in August, with the latest survey from Judo Bank showing a services PMI score of 52.5, up from 50.4 in July and further above the expansion threshold of 50.In the currency market, the Aussie dollar was trading at $0.670 on Wednesday.### Japanese MarketThe Japanese stock market also saw a sharp decline on Wednesday, adding to slight losses from the previous session and mirroring Wall Street’s broadly negative sentiment. The Nikkei 225 fell by more than 3 percent, approaching the 37,400 level, with sector-wide weakness led by index heavyweights and technology stocks.The benchmark Nikkei 225 Index closed the morning session at 37,405.59, down 1,280.72 points, or 3.31 percent, after hitting a low of 37,122.33 earlier. Japanese stocks had ended slightly lower on Tuesday.Market heavyweight SoftBank Group fell 6.5 percent, and Uniqlo operator Fast Retailing was down over 2 percent. Among automakers, Honda lost nearly 4 percent, and Toyota declined more than 2 percent.In the tech sector, Advantest plunged over 9 percent, Screen Holdings slipped nearly 8 percent, and Tokyo Electron slid more than 7 percent.In the banking sector, Mizuho Financial and Sumitomo Mitsui Financial both lost over 4 percent each, while Mitsubishi UFJ Financial declined nearly 4 percent.Among major exporters, Canon and Sony both fell more than 2 percent each, while Panasonic dropped nearly 2 percent, and Mitsubishi Electric declined nearly 4 percent.Among the notable decliners, Socionext and Renesas Electronics are experiencing a severe drop of over 9% each. Furukawa Electric, Disco, and Fujikura are also plummeting by more than 7%. Tokyo Electric Power and Shin-Etsu Chemical are both down nearly 7%, while Yokogawa Electric, IHI, Hitachi, and Japan Steel Works are all shedding more than 6%.Conversely, there are no significant gainers to report.On the economic front, Japan’s services sector continued its expansion in August at a steady rate. According to the latest survey released by Jibun Bank on Wednesday, the services PMI remains at 53.7, unchanged from July. This figure is above 50, indicating ongoing growth in the sector.In the currency market, the U.S. dollar is trading in the lower 145 yen range on Wednesday.Across Asia, Taiwan has tumbled by 3.6%, South Korea has slipped 2.5%, and Singapore is down by 1.5%. Meanwhile, New Zealand, China, Hong Kong, and Malaysia are all lower by between 0.2% and 0.9%. Indonesia, however, is an outlier, showing an increase of 0.3%.On Wall Street, stocks took a sharp downturn throughout Tuesday’s trading session, effectively erasing the strong gains made last Friday. The Dow dropped significantly from its record closing high set the previous session. While the major indexes recovered slightly from their worst levels by the close, they still posted considerable losses. The Nasdaq fell by 577.33 points, or 3.3%, to 17,136.30. The S&P 500 dropped 119.47 points, or 2.1%, to 5,528.93, and the Dow declined by 626.15 points, or 1.5%, to 40,936.93.Major European markets also witnessed notable declines. The German DAX Index decreased by 1.0%, the French CAC 40 Index fell by 0.9%, and the U.K.’s FTSE 100 Index was down by 0.8%.Crude oil prices plummeted to a nine-month low on Tuesday due to concerns over potential oversupply from OPEC. West Texas Intermediate Crude oil futures for October dropped by $3.21, or 4.4%, to settle at $70.34 a barrel.The material has been provided by InstaForex Company – www.instaforex.com
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