FX.co ★ Most Asian stock indices fall

The Asian stock markets were mostly declining at the beginning of the week. Thus, the Chinese Shanghai Composite index lost 0.78%, and the Shenzhen Composite index showed quite a slight decline of 0.05%. The Japanese Nikkei 225 stock index decreased by 1.57%, while the Korean KOSPI slightly increased by 0.06%. The Hong Kong and Australian exchanges are closed today due to the celebration of Catholic Easter.

There are several reasons for investors to be pessimistic. There is a tense situation with the spread of COVID-19 in China and the imposed restrictions. Investors fear that this situation will hurt economic growth.

The second reason is the continuation of the Russian-Ukrainian conflict, which could lead to the introduction of the next package of sanctions against Russia. This, in turn, will affect not only the Russian economy but other economies as well. Currently, the economies of different countries are so interconnected and interdependent that sanctions against one state imminently affect other countries as well.

According to the latest statistics, retail sales in China fell by 3.5% in March yearly. The indicator reached such a low level for the first time in the last two years. At the same time, a month earlier the indicator grew by 6.7%. According to analysts' forecasts, the indicator should have decreased, but only by 2%.

Last month, the unemployment rate in China increased to 5.8%, which happened for the first time in the last two years. In February, the reading was 5.5%. Analysts attribute this to the introduction of restrictive measures in the country due to a new outbreak of coronavirus.

As a result of the coronavirus restrictions, industrial growth slowed last month to 5% from February's 7.5%.

Overall, in Q1 2022, China's economic growth was 4.8% on a yearly basis. For comparison, this indicator for Q4 2021 was 4%. The GDP growth rate was higher than experts had predicted, who had forecasted a 4.4% growth.

In China, investment in fixed assets increased by 9.3% in Q1 2022 compared with the same period last year. The total amount of investment is estimated at £10.49 trillion, or $1.6 trillion. At the same time, the reading exceeded the expectations of analysts, who forecasted an increase of 8.5%.

Among the companies included in the Shanghai Composite index, Orient Securities Co., Ltd., and Inly Media Co. were. Ltd. dropped by 10% each. Shandong Donghong Pipe Industry Co. fell by 9.99%.

among the components of the Nikkei 225 index, Sumitomo Pharma Co., Ltd. dropped by 5.8%, Toho Zinc Co. fell by 5.3%, Tokai Carbon Co. decreased by 4%, and Recruit Holdings Co. lost 3.9%.

Slightly smaller decreases in the value of securities were shown by other Japanese companies. Toyota Motor Corp. lost 0.3%, SoftBank Group Corp. decreased by 1%, Fast Retailing Co. fell by 1.6%, and Toshiba Corp. dropped by 1.2%.

The biggest companies among KOSPI's components that demonstrated growth in the values of their securities were Kia Corp. with its shares gaining 1.7%, as well as Hyundai Motor Co., Ltd. and Samsung Electronics Co. adding 0.6% each.