Asian Stocks Decline On Weak Economic Data From Europe, Poor US Jobs Numbers

Asian stocks fell Thursday as weak economic data from the Eurozone and the US raised concerns over the strength of global economic recovery.

A slew of soft manufacturing reports from Europe and weak reading on the US private-sector hiring in April dampened hopes for a global economic recovery inspired by a pickup in the US factory output and an improvement in China.

Payroll firm ADP Employer Services said the US private sector added far fewer jobs than expected in April. Companies added 119,000 workers to their payrolls, down from a downwardly revised 201,000 jobs added in March. The numbers also fell short of Thomson Reuter’s expectation of 177,000 jobs.

The disappointing ADP data cast doubts over the official government numbers for April, which is scheduled to be released on Friday.

“The soft ADP report in particular highlights downside risks to the consensus for the April non-farm payrolls data and consequently we have revised down our expectations to 130k from 170k, an outcome that would prompt concerns about a renewed weakening in the US jobs market,” said a note from Credit Agricole.

Hong Kong's Hang Seng declined 0.28 percent or 59.55 points to 21,249.53, South Korean KOSPI fell 0.2 percent or 3.96 points to 1,995.11 and Indian benchmark BSE Sensex fell 0.87 percent, while Chinese Shanghai gained 0.07 percent.

Bank of China Ltd. Plunged 3.07 percent and China Construction Bank Corp. plunged 3.08 percent in Hong Kong after Temasek Holdings sold $2.48 billion of shares in both the banks as profit growth in banks is decreasing with tighter controls on lending in the country.

Poly Real Estate Group declined 0.38 percent and China Vanke declined 1.95 percent after Chinese media reported several banks in Shanghai, including ICBC, had withdrawn their discounted mortgage offers, raising fears that property sales could drop further, Reuters reported.

In Seoul, Shipbuilders and technology companies shares led the decline. Daewoo Shipbuilding & Marine Engineering declined 2.17 percent and STX Offshore & Shipbuilding Co declined 2.67 percent, while LG Display Co. plunged 6.56 percent on news that prosecutors questioned company employees about alleged OLED technology infringement.

Weak employment report from Europe also added to concerns. Unemployment in the Eurozone region increased to 10.9 percent in March, the highest level since the formation of the euro bloc in 1999.

Meanwhile, manufacturing activity in the Eurozone region shrank at the sharpest level in nearly three years in April. The Markit Economics manufacturing purchasing managers Index fell to 45.9 in April from 47.7 in March. Moreover, PMIs from Germany, Spain and France fell short of expectations and showed that manufacturing activity contracted sharply.