Asian shares nosedive, Japan slides into recession after Paris attacks - Hindustan Times
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Asian shares nosedive, Japan slides into recession after Paris attacks

Reuters | By
Nov 16, 2015 09:16 AM IST

Japan’s economy slid back into recession in July-September as uncertainty over the overseas outlook hurt business investment, keeping policymakers under pressure to deploy new stimulus measures to support a fragile recovery.

Asian stocks fell to six-week lows on Monday and emerging market currencies wilted as investors sought the safety of the greenback in the wake of Friday’s deadly attacks in Paris and downbeat economic data.

Japan’s economy slid back into recession in July-September as uncertainty over the overseas outlook hurt business investment, keeping policymakers under pressure to deploy new stimulus measures to support a fragile recovery.(AFP Photo)
Japan’s economy slid back into recession in July-September as uncertainty over the overseas outlook hurt business investment, keeping policymakers under pressure to deploy new stimulus measures to support a fragile recovery.(AFP Photo)

MSCI’s broadest index of Asia-Pacific shares outside Japan fell more than 1% in early trade after a 3% loss last week.

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Leading the losers were the Nikkei stock index which tumbled nearly 1.3%, nearly wiping out last week’s 1.7% gain as latest economic data undershot expectations.

The Korea Composite Stock Price Index (KOSPI) fell 1.0% to 1,952.49 points as decliners outnumbered advancers by 35 to 10.

Recent economic data from China, where stock markets have recovered some of their poise after a summer collapse, has disappointed global investors.

Credit activity in China’s financial system dropped to its lowest level in 15 months in October, while data last week showed steel consumption, a key measure of economic activity, slowed further.

Japan slides into recession

Japan’s economy slid back into recession in July-September as uncertainty over the overseas outlook hurt business investment, keeping policymakers under pressure to deploy new stimulus measures to support a fragile recovery.

A rebound in private consumption and exports offered some hope the world’s third-largest economy is emerging from the doldrums, despite slowing Chinese demand and the pain households are feeling from rising imported food prices.

Still, many analysts expect the economy to grow only moderately in the current quarter as companies remain hesitant to use their record profits for wage hikes, underscoring the challenges premier Shinzo Abe faces in pulling Japan sustainably out of stagnation with his “Abenomics” stimulus policies.

“A big drop in inventory was the largest factor behind a third-quarter contraction. Weak capital spending was a concern, but excluding these factors, the GDP figures were not so bad,” said Takeshi Minami, chief economist at Norinchukin Research Institute.

Stock futures were pointing to another weak start on Wall Street after main indexes shed about 1% in light volume in late trading on Friday. News of the attacks by gunmen and bombers that killed 132 people in the French capital came after US markets closed.

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