Asian stocks steady after strong rally; South Korea hits record, China data disappoints
Most Asian stock markets traded steady on Monday after strong gains last week. South Korea touched fresh record highs, while China’s indexes stayed near decade peaks despite weaker-than-expected factory output and retail sales.
Chinese blue-chip stocks led regional gains, with tech shares extending their rally. Sentiment followed Wall Street, where renewed optimism around artificial intelligence (AI) helped push all three major U.S. indexes to record highs last week.
As of 03:50 GMT, U.S. stock index futures traded flat.
China factory output misses estimates, retail sales soften
China’s industrial production grew 5.2% year-on-year in August, slowing from July’s 5.7% and missing forecasts. Retail sales rose 3.4%, down from July’s 3.7% and below expectations of 3.8%.
The weaker data suggested that momentum in the world’s second-largest economy remains fragile. Analysts at ING said the repeated misses create a “sense of déjà vu,” echoing last year’s slowdown. They expect more government stimulus could be announced soon.
Still, Chinese stocks pushed higher. The Shanghai Composite Index added 0.2%, staying close to 10-year highs. The CSI 300 jumped nearly 1% to hover at a three-year peak, while Hong Kong’s Hang Seng Index rose 0.3%, near four-year highs.
U.S.-China trade talks begin in Madrid
High-level U.S.-China trade talks started Sunday in Madrid, covering tariffs, export controls, and digital economy disputes. The meetings follow a 90-day truce agreed in July.
A day before the talks, China’s commerce ministry launched two probes into U.S. trade policies — one over chip-related discrimination and another into dumping practices. These investigations boosted optimism for Chinese chipmakers, as investors expect domestic firms could gain if U.S. restrictions deepen.
South Korea’s KOSPI sets fresh record; Fed decision in focus
South Korea’s KOSPI climbed 0.6% to a record 3,420.23 points, led by semiconductor giants Samsung Electronics and SK Hynix. Investors also welcomed signs of government reform, including the delay of proposed capital gains tax changes.
The outlook for Asian markets is now tied to the upcoming Federal Reserve rate decision. Investors widely expect a 25 basis point cut, supported by weak U.S. job data and firm inflation. Lower rates could boost global risk appetite.
Elsewhere in Asia:
- Japan’s markets were closed for a holiday but remain near record highs, supported by tech and industrial stocks.
- Australia’s S&P/ASX 200 slipped 0.2%.
- Singapore’s Straits Times Index traded flat.
- India’s Nifty 50 opened largely unchanged.
