The companies’ shares in the Asian market slid on Monday amid the investors awaited for data this week that could provide more evidence to the slowdown in the Chinese economy, while the dollar gave up a little of its recent gains against a basket of major currencies.
The flash manufacturing PMI reading of China, which is due on Tuesday, is expected to come in below the 50 level, providing enough evidence to the fact that the manufacturing activity in Asia’s largest economy is contracting.
Mentioning in the note to the clients, Mitul Kotecha, head of FX strategy Asia-Pacific for Barclays in Singapore, said, “The psychological effect of a below-50 reading will be significant and consistent with the slew of softer Chinese data over recent weeks.”
Talking about the expected reading for the Chinese economic activity, Finance Minister Lou Jiwei said on Sunday that Beijing will not dramatically revise its economic policy due to any one economic indicator.
He made the remarks at the G20 nations meeting of finance ministers and central bank chiefs in the Australian city of Cairns.
Jiwei’s comments came days after several economists and global financial experts lowered China’s growth forecasts on the basis of the latest set of weak data.
During the meeting of the Group of 20 nations, the leaders said that they will be adding an extra USD 2 trillion to the global economy, while creating millions of new jobs. They also expressed concern over the sluggish euro zone economy that is showing extended stagnation, turning out to be a major stumbling block for the developing nations.
Meanwhile, the US dollar gave up 0.2 percent to 84.600 against the major currencies. The greenback eased about 0.2 percent to 108.85 yen against the Japanese currency on Friday.
While the euro edged up 0.2 percent to USD 1.2854 against the dollar on Friday.