Asian Stock Markets Decline After China Trade Data

Asian stock markets ended lower Tuesday as weak Chinese trade data stoked fears of a growth slowdown in the world's second-largest economy.

Japanese benchmark Nikkei fell 0.44 percent or 39.15 points to 8,857.73, the Chinese Shanghai composite declined 0.29 percent or 6.38 points to 2,164.44 and Hong Kong's Hang Seng slipped 0.16 percent or 31.73 points to 19,396.36 while South Korean KOSPI fell 0.36 percent and Indian benchmark BSE Sensex gained 0.52 percent.

China's trade surplus widened to $31.73 billion in June, up 42.9 percent compared to the same month last year amid slower-than-expected growth in imports. Exports rose 11.3 percent in June from a year earlier, down from 15.3 percent increase in May.

Imports grew 6.3 percent on annual basis in June, down from 12.7 percent in May and also fell short of economists' estimation of 12.7 percent, raising concern that the world's largest emerging economy wasn't doing enough to stimulate domestic demand and avert a slowdown.

Slower import growth suggests that domestic demand is weaker and bodes ill for the GDP growth deceleration. The Chinese second-quarter economic activity data will be released Friday and is expected to show that the economy grew at the slowest pace in three years.

The more worrying sign is the slowdown in imports. It reinforces worries about the slowdown in the Chinese economy. As long as the country can maintain 5 to 10 percent growth in exports and imports, it will be able to keep a relatively healthy labour market. In the short term, the market will continue to see some downward pressure, Li Wei, an economist at Standard Chartered, told Reuters.

Japanese shares ended lower for the fourth day after the Chinese data. Komatsu Ltd. plunged 3.45 percent and Sony Corp. fell 2.52 percent while Toyota Motor Corp. declined 1.90 percent.

Nikon Corp slumped 7.01 percent after Intel Corp., its second-biggest customer, agreed to invest as much as $4.1 billion in ASML Holding NV, Bloomberg reported.

Property developers and shares led the declines in Shanghai. Poly Real Estate Group plunged 3.62 percent and Gemdale Corp. fell 1.58 percent in Shanghai while ZTE Corp. slumped 8.77 percent in Hong Kong.

Financial stocks plunged across the region. Nomura Holdings plunged 3.2 percent and Daiwa Securities Group Inc. fell 3.52 percent in Tokyo while Ping An Insurance Group declined 0.97 percent in Hong Kong.