Asia stocks down after muted China manufacturing

PUBLISHED : Monday, 02 December, 2013, 1:30pm
UPDATED : Monday, 02 December, 2013, 1:35pm


KUALA LUMPUR, Malaysia (AP) — Muted Chinese manufacturing weighed on Asian stock markets Monday as investors awaited the release of U.S. data that might provide clearer signs about when the Federal Reserve will cut its monetary stimulus.

Thailand's benchmark sank 1 percent to 1,357.42 as protesters vowed to continue a campaign to topple the government of Prime Minister Yingluck Shinawatra after a weekend of chaos in pockets of Bangkok killed at least three people and injured dozens.

China's Shanghai's Composite Index dropped 1.6 percent to 2,183.88 after two surveys showed Chinese manufacturing barely expanded in November in further evidence of sluggish recovery in the world's No.2 economy. Expectations of more initial public offerings in the pipeline, which could take investment away from existing listings, also weighed.

Japan's Nikkei 225 eased 0.3 percent to 15,610.40.

Hong Kong's Hang Seng rose 0.1 percent to 23,907.90. Seoul's Kospi dropped 0.7 percent to 2,031.10 and Australia's S&P/ASX 200 shed 0.9 percent to 5,271.60. Excepting Thailand, markets in Southeast Asia rose.

Markets appeared to be winding down ahead of year-end holidays but a slew of U.S. data this week on manufacturing, home sales, jobs report and a third quarter GDP revision could provide final clues on when the Fed will cut, or taper, its $85 billion of monthly bond purchases, Credit Agricole CIB in Hong Kong said in a market commentary. The Fed's next policy meeting is on Dec. 17-18.

"Over coming days, there will be plenty of evidence to finalize opinions about what the Fed will do at its December 17-18 meeting," it said. "We maintain the view that the Fed will likely begin to taper in January."

The Fed's stimulus has kept interest rates low to support economic recovery in the U.S. but also propelled money into higher yielding stocks. Frequent shifts in expectations about when the stimulus will be withdrawn have been key driver of markets in the past few months and could decide how they end the year. Most economists think the Fed will maintain the stimulus until early next year, rather than start reducing it in December.

Wall Street fizzled Friday at the end of a holiday-shortened trading day, but still logged its longest streak of weekly gains in a decade.

The Standard & Poor's 500 ended down one point, or 0.1 percent, to 1,805.81. The Dow Jones industrial average slipped 10 points, or 0.1 percent, to 16,086.41.

In energy markets, benchmark crude for January delivery was up 58 cents to $93.30 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 42 cents to close at $92.72 on Friday.

The euro rose to $1.3603 from $1.3588 late Friday. The dollar dropped to 102.33 yen from 102.46 yen.