BANGKOK (AP) — Asian stocks fell Wednesday, with contradictory economic data out of the U.S. dragging down market enthusiasm.Investors faced some confusing data out of the U.S.: Separate reports showed better-than-expected retail sales, a sign that Americans are spending, but also stagnant inventories among U.S. companies, an indication of caution among businesses.
Americans increased their retail spending in July by the most in five months, a gain of 0.8 per cent over June. The increase was welcome since it came after three straight monthly declines. But the sluggish inventory trend could act as a drag on overall economic growth. When businesses place fewer orders, factory production slows.
Japan’s Nikkei 225 index fell 0.3 per cent to 8,903.85. Hong Kong’s Hang Seng index fell 1.1 per cent to 20,074.08, while Australia’s S&P/ASX 200 lost 0.4 per cent to 4,275.70. Markets in South Korea were closed for a public holiday.
A gloomy picture out of Europe also compounded worries. Although Germany posted surprise growth of 0.3 per cent in the second quarter on Tuesday, it was not enough to prevent the 17-country eurozone economy from contracting 0.2 per cent in the period.
Analysts at Capital Economics said in an email commentary that “the big picture is that the economic growth required to bring the region’s debt crisis to an end is still nowhere in sight.”
Over the past few weeks, stocks, as well as the euro and the price of oil, have rallied on hopes the world’s major central banks will do more to shore up the global economy.
Many economists believe the U.S. Federal Reserve will try to stimulate the economy by launching another program of buying government bonds and mortgage-backed securities to keep interest rates low. They will be closely watching Fed Chairman Ben Bernanke’s speech on Aug. 31 at an annual economic conference in Jackson Hole, Wyoming.
On Wall Street on Tuesday, the Dow Jones industrial average edged up marginally to 13,172.14. The Standard & Poor’s 500 index was slightly down at 1,403.93. The Nasdaq composite index lost 0.2 per cent to 3,016.98.
Benchmark oil fell 34 cents to $93.09 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 70 cents to end at $93.43 a barrel on the Nymex on Tuesday.
In currency trading, the euro fell to $1.2322 from $1.2330 in late trading Tuesday in New York. The dollar rose to 78.82 yen from 78.79 yen.