Most Asian stocks declined on Monday amid uncertainty about what a potential change in administration in the United States might entail for the region. The unexpected interest rate cut in China did little to lift trader sentiment.
While Wall Street futures initially rose after Biden’s decision, they pared most of their gains in the Asian session. The prolonged decline in technology stocks also pressured Asian markets, as a mix of profit-taking and shifting to other sectors led to sharp losses in technology.
In China, the Shanghai and Shenzhen indices, as well as the Shanghai Composite Index, each fell by 0.7% on Monday, receiving little support from the unexpected cut in the country’s benchmark borrowing costs.
The People’s Bank of China unexpectedly cut its one-year and five-year loan prime rates in a bid to support growth, but this move did little to improve sentiment towards Chinese markets, which have suffered heavy losses in recent weeks amid increasing speculation of Trump’s re-election.
Concerns about China impacted other regional markets, with the Australian index dropping by 0.8%, as the country has close trade ties with Beijing. The Japanese Nikkei 225 index fell by 1.1%.
The Hang Seng Index in Hong Kong was the only gainer in Asia, rising by 0.4% due to some bargain hunting in heavyweight technology stocks. The index had fallen to a three-month low earlier in the session.
