Struggling US economy causes Asian markets to slip
BANGKOK – Signs that the U.S. economy may be struggling dampened investor sentiment in Asia on Thursday.
Hong Kong's Hang Seng index dropped 0.2 percent to 23,271.31. On mainland China, the Shanghai Composite Index lost 0.2 percent to 2,860.48, while the smaller Shenzhen Composite Index rose 0.1 percent to 1,188.63. Australia's S&P ASX 200 fell 0.1 percent to 4,738.10.
Benchmarks in Singapore, Malaysia, Indonesia and New Zealand also fell, but Taiwan's TAIEX bucked the trend and rose 0.8 percent to 9,016.06. Markets in South Korea and Japan were closed for a holiday.
On Wall Street on Wednesday, stocks fell after payroll processor ADP said companies added 179,000 new jobs in April — far fewer than economists had expected. That raised worries about what the government's monthly jobs report for April will reveal when it is released Friday.
In a separate report, the Institute for Supply Management said its service sector index rose at the slowest pace in 8 months in April, as many companies express concerns about higher food and gas prices.
The U.S. service industry employs about 90 percent of the U.S. work force, so signs of a slowdown in the service sector index have implications for the overall economy.
Oil dropped below $110 per barrel Wednesday after a U.S. government report showed that supplies of petroleum products are growing as demand weakened in the U.S.
Benchmark crude for June delivery dropped 60 cents to $108.64 per barrel on the New York Mercantile Exchange on Thursday. The contract lost $1.81 to settle at $109.24 per barrel on Wednesday.
Signs that the U.S. economic recovery is slowing also dragged down oil prices, which hurts the energy companies whose fortunes depend on them.
Hong Kong-listed shares of PetroChina, China's biggest oil and gas company, lost 1.9 percent while China Petroleum & Chemical Corp., Asia's biggest refiner, slipped 0.8 percent.
But shares in airlines, which benefit from lower oil prices, were up. China Eastern Airlines Corp. Ltd. rose 2.4 percent; China Southern Airlines Co. Ltd. was 2 percent higher. Taiwan's EVA Airways Corp. was 0.7 percent higher.
Shares of Hong Kong-listed Zijin Mining Group, China's biggest gold miner, dropped 1.9 percent, a day after a court in southeastern China ordered the company to pay a $4.6 million fine for toxic mine spills at the Zijinshan Gold and Copper Mine nearly a year ago.
The Dow Jones industrial average fell 0.7 percent to close at 12,723.58. The Standard & Poor's 500 index fell or 0.7 percent to 1,347.32. The Nasdaq composite index fell 0.5 percent to 2,828.23.
In currencies, the euro dropped to $1.4840 from $1.4849 late Wednesday in New York. Earlier Wednesday the dollar fell to $1.4942 — its lowest point since December 2009.
The dollar weakened against Japan's currency to 80.44 yen from 80.58 yen.