Asian Markets, Metals Drop on China Overheating

123jump.com Staff
21 Jan, 2010
New York City

Markets in Asia and Europe were on the defensive after China reported fourth quarter economic expansion of 10.7%. In 2009, economy grew at a rate of 8.7%, above 8% target rate. Metal prices fell in London trading on the worries that China will issue more measures to tighten lending.

[R]8:20 AM New York – Markets in Asia and Europe were on the defensive after China reported fourth quarter economic expansion of 10.7%. In 2009, economy grew at a rate of 8.7%, above 8% target rate. Metal prices fell in London trading on the worries that China will issue more measures to tighten lending.[/R]

Markets in Asia were on the defensive after China reported another quarterly economic expansion that fueled worries that Chinese economy may have overheated.

In the fourth quarter economy expanded at 10.7% compared to a year ago and in 2009 grew at 8.7% above its target rate of 8%. China also revised its third quarter expansion to 9.1% from the previous estimate of 8.9% and first quarter at 6.2% from 6.1%.

Fixed investment in urban areas soared 30.5% in 2009 according to the Chinese statistics agency.

Industrial production increased in December at 18.5% and retail sales surged at 17.5% according to a separate report issued by the agency.

Commodities prices in Asia and later in London declined on the worries that China will soon issue tighter monetary rules and force bank to increase their reserve ratios.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 130.89 or 1.22% to 10,868.41, and Hang Seng index in Hong Kong decreased 423.50 or 1.99% to 20,862.67, and CSI 300 index in China higher 14.14 or 0.42% to 3,408.57. ASX 200 index in Australia decreased 41.00 or 0.84% to 4,827.20. The FTSE Bursa KL Composite index in Malaysia was higher 1.74 or 0.13% to 1,308.36.

The Kospi Index in South Korea increased 7.63 or 0.45% to close at 1,722.01. SET index in Thailand closed lower 12.81 or 1.75% to 718.99. JSE Index in Indonesia decreased 28.88 or 1.08% to 2,638.38. The Sensex index in India decreased 423.35 or 2.42% to 17,051.14.