Asian Stock Market Open Declines Due to Low Demand in China: Market Summary

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Asian stocks opened lower following data that showed signs of slack in China and news that US President Joe Biden plans to raise tariffs on some goods from the world’s second-largest economy. Equity benchmarks in Australia and Japan declined, as did Hong Kong futures. US contracts also edged lower after the S&P 500 struggled to gain traction late last week as consumer sentiment declined to a six-month low and short-term inflation expectations picked up.

Biden is set to double, triple, and quadruple tariffs on some Chinese goods this week, sparking concerns among investors. However, Larry Hu, an economist at Macquarie Group, reassures that the big miss in credit data in April is largely due to technical reasons, rather than a sharp deterioration in the underlying economy.

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Global investors are eagerly awaiting comments from US officials for insights into the Federal Reserve’s interest rate policies. The US April inflation print on Wednesday is expected to provide the next major catalyst for trading, with expectations for consumer resilience to continue dampening hopes of inflation cooling off.

Commodities such as gold and oil will also be in focus, especially after President Vladimir Putin’s recent move in replacing his defense minister amid the conflict in Ukraine. Oil edged lower in early trading while gold remained stable. These geopolitical events could impact the financial markets in the coming days.

Looking ahead, this week will feature key events such as China’s policy rate decision, Eurozone inflation and growth figures, and speeches from various Fed officials, including Powell. Additionally, Australian jobs data and the nation’s government spending plans will be topics of interest.

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