Most Asian stock markets slipped on Wednesday, following overnight losses on Wall Street as investors grew cautious over U.S. trade tariffs. Positive economic readings in Australia and China provided little support, with both markets seeing declines.
Wall Street’s weak start to September weighed on sentiment. An appeals court ruling against Trump’s tariffs raised uncertainty, complicating recent U.S. trade deals with key global economies.
S&P 500 futures rose 0.1% in Asian trade, supported by Alphabet (NASDAQ:GOOGL) after an antitrust ruling was less harsh than expected. Still, this momentum failed to lift broader Asian markets, where investors also booked profits after strong August rallies.
Australia’s ASX drops as strong GDP clouds rate cut hopes
Australia’s ASX 200 index led losses, falling 1%. The drop followed data showing stronger-than-expected GDP growth in the second quarter, supported by domestic demand and steady government spending.
The robust numbers reduced expectations for further rate cuts by the Reserve Bank of Australia. Analysts at Capital Economics warned that rising consumer spending and tight labor conditions may keep inflation sticky, limiting the RBA’s ability to ease policy aggressively.
The central bank has already cut rates three times this year but remains cautious about additional moves. PMI data released Wednesday also pointed to strong growth in both manufacturing and services.
China stocks retreat despite upbeat PMI
China’s CSI 300 and Shanghai Composite indexes fell 0.7% and 1%, while Hong Kong’s Hang Seng slipped 0.2%. Profit-taking weighed heavily after sharp August rallies that lifted the CSI 300 by 10.3% and the Shanghai Composite by 8%.
Private PMI data showed stronger-than-expected services growth, following earlier positive manufacturing figures. While this pointed to resilience in China’s economy, it failed to offset profit-taking pressures. Beijing is now expected to roll out more stimulus measures to support growth.
Chinese tech and chip stocks, key drivers of last month’s rally, also dropped. Cambricon Technologies (SS:688256), an AI chipmaker, fell 4.1%.
Other Asian markets mixed
Elsewhere, South Korea’s KOSPI gained 0.3% after GDP data beat expectations, though tech weakness capped gains. Japan’s Nikkei 225 lost 0.3% and the TOPIX fell 0.4%, even as PMI data signaled stronger August activity.
India steadies amid trade tensions
India’s Nifty 50 index was flat, stabilizing after recent losses that sent it to a three-week low. Markets remain on edge as Trump’s 50% tariffs on Indian goods took effect.
Indian Commerce Minister Piyush Goyal said trade talks with Washington are ongoing and a deal could be finalized by November. The U.S. tariffs aim to push India away from Russian oil imports, but New Delhi has refused, citing cost advantages.
India also moved closer diplomatically to China and Russia, a trend that risks further straining relations with the U.S. Concerns over tariffs left the Nifty down nearly 2% in August.
