Hong Kong (AFP) – Asian markets were mostly up Wednesday as investors weighed bullish growth targets announced by China despite its sluggish economy and the looming prospect of a global trade war. Global stocks had tumbled Tuesday after China, Mexico, and Canada hit back at US tariffs, and fears grew that Europe could be President Donald Trump’s next target.
Investors welcomed China’s economic targets for the coming year on Wednesday as the government held its annual meeting of the National People’s Congress. However, observers have tempered expectations for the stimulus given China is facing strong economic headwinds. These include a persistent property sector debt crisis, stubbornly low consumer demand, and stuttering employment for young people.
China set an annual growth target of around five percent on Wednesday, vowing to make domestic demand its main economic driver. Beijing also announced a rare hike in fiscal funding, allowing its budget deficit to reach four percent this year. It comes alongside a pledge to create 12 million new jobs in China’s cities and a push for two percent inflation in 2025, according to an official document seen by AFP Wednesday. The world’s second-largest economy is also planning to increase defense spending by 7.2 percent, the same as last year.
Hong Kong rose around 2.5 percent in early trade before pulling back to around 1.5 percent. Jakarta climbed more than two percent and Taipei jumped one percent. Tokyo and Shanghai held steady while Seoul was slightly up. Sydney, Wellington, and Bangkok were down around one percent.
Hong Kong firm CK Hutchison rose 25 percent after the company agreed to sell its lucrative Panama Canal ports to a US-led consortium under fierce pressure from Trump. US tariffs are expected to hit hundreds of billions of dollars in total trade between the US and China. Trump signed an executive order on Monday to increase a previously imposed 10 percent tariff on Chinese goods to 20 percent. China responded by saying it would impose levies of 10 and 15 percent on a range of US agricultural imports.
“Investors don’t like tariffs, and they are deeply uncomfortable with President Trump’s new world order, which is weighing on market sentiment,” said Kathleen Brooks, research director at XTB trading platform. “More tariffs are expected from the US in the coming weeks, including for the EU and reciprocal tariffs, which could keep investors on edge in the short term.”
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 0.13 percent at 37,380.67
Hong Kong – Hang Seng Index: UP 1.4 percent at 23,271.04
Shanghai – Composite: DOWN 0.3 percent at 3,314.84
Euro/dollar: UP at 1.0608 from 1.0485 on Tuesday
Pound/dollar: UP at $1.2775 from $1.2694
Dollar/yen: UP 149.93 from 149.32 yen
Euro/pound: UP at 83.04 pence from 82.60 pence
West Texas Intermediate: DOWN 0.73 percent at $67.76 per barrel
Brent North Sea Crude: DOWN 0.30 percent at $70.83 per barrel
New York – Dow: DOWN 1.6 percent at 42,520.99 (close)
London – FTSE 100: DOWN 1.3 percent at 8,759.00 (close)
© 2024 AFP
