Asian stocks dropped significantly to 3.7%. The general trend is that all major Asia-Pacific stock indexes declined. However, some of them dropped less dramatically. Thus, the KOSPI lost 0.89%. The S&P/ASX 200 and Nikkei 225 decreased by nearly the same amount, i.e. by 0.87% and 0.88% respectively. Chinese indicators declined more significantly: the Shanghai Composite fell by 2.25%, the Shenzhen Composite dropped by 3.4%. The Hang Seng Index lost more than others, it went down 3.66%.
Overall, Chinese stock indices dropped sharply last week: the Shanghai Composite fell by 4.08%, the Shenzhen Composite decreased by 4.47%, while the Hang Seng Index lost even more, it declined by 8.49%. At the same time, the KOSPI added 2.49%, the S&P/ASX 200 gained 1.63%, and the Nikkei 225 advanced by 0.8% over the week.
Friday's investor pessimism was caused by concerns about the country's economic growth prospects due to the appointment of China's leader Xi Jinping for a third term. The market is uncertain how China's economy will develop further.
Despite positive weekly dynamics, Japan's main indicator, the Nikkei 225, as well as other indicators declined on Friday. The main reason for this was negative results of financial statements of some US tech companies for the third quarter. This fact exerted pressure on Japanese stocks.
Moreover, the Central Bank of Japan announced that the stimulus program for the country's economy remained unchanged. The interest rate was kept at -0.1%, while 10-year government bond yields remained about zero. Therefore, the regulator's decision was in line with experts' forecasts.
At the same time, the unemployment rate in Japan rose to 2.6% last month from 2.5% in August. The figure exceeded analysts' forecasts. Moreover, analysts expected it to remain at the same level.
Investors are in "waiting mode" ahead of the US Federal Reserve's meeting next week. It is expected that the central regulator may adopt a more dovish monetary policy in the future.
The corporate reporting season also started in Japan. Some companies had already published positive results. However, most companies will release their reports as early as next week.
Fanuc's stocks dropped by 5.7% due to decline in its profit forecast and negative results of its reports.
Moreover, shares of Kawasaki Kisen Kaisha Ltd. (-4.4%) and Hoya Corp. (-4.3%) sank.
The stocks of Advantest rose by 2.39% due to positive results of its financial reports. Moreover, Hino Motors and Fujitsu released positive results at the end of the past quarter. Their shares grew by 5.04% and 3.14% respectively.
The Hang Seng Index has hit its low for the last 13 years. One of the possible reasons was that Japan's central regulator planned to continue dovish monetary policy in the country. Some experts believe that this decision is determined by the desire to buy time through minimal intervention in the economy and the currency market.
Among the components of the Hang Seng Index, stocks of Country Garden Holdings Co. Ltd., China Mengniu Dairy Co. Ltd. as well as Longfor Group Holdings Ltd. were top losers. They plunged by 9.9%, 9.5% and 9.2% respectively.
Stocks of China CITIC Bank Corp. fell by 0.3% amid a slight increase in its net profits, compared with the rise in its operating profits and net interest income.
Among the components of the KOSPI, the stocks of Samsung Electronics Co. dropped by 3.2%. Moreover, the shares of SK Hynix Inc fell by 6.7% due to the results of financial statements, which were not in line with the experts' forecasts and news about the company's intention to reduce its capital expenditures.
At the same time, the stocks of Kia Corp. increased by 0.8% and shares of Hyundai Motor Co. added 1.3%.
Among the components of the S&P/ASX 200, the stocks of BHP and Rio Tinto lost 5% and 4.4% respectively.
