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=ASIA MARKETS: Nikkei Asia300 Drops Amid Geopolitical, Trade Worries

HONG KONG (Apr 17) -- Asian equities outside of Japan fell on Tuesday as China’s better-than-expected growth numbers failed to cheer investors still worried about global trade tensions and geopolitical uncertainty.

The Nikkei Asia300 Index shed 0.8% to 1,413.74. Heavyweights Tencent Holdings and Samsung Electronics, among Asia’s top three most valuable companies, fell 1.4% and 0.7%, respectively. Taiwan Semiconductor Manufacturing dropped 2.3%. Country gauges for Hong Kong, South Korea and Taiwan declined 0.5%, 0.6% and 2%, respectively. India’s index edged 0.1% higher.

The country gauge for China lost 1.1% even as data released Tuesday showed Asia’s largest economy grew a faster-than-expected 6.8% in the March quarter from a year earlier. China’s industrial output grew at a slower-than-expected 6% in March, while fixed-asset investment expansion slowed to 7.5% in the first quarter.

“While we don’t think China’s economy is expanding as rapidly as the official figures claim, there is broader evidence to suggest that a recovery in industry did prevent growth from slipping too much last quarter,” Julian Evans-Pritchard, senior China economist at Capital Economics, wrote in a note. “Looking ahead, while the Chinese economy held up fairly well in Q1 we think a further slowdown is on the cards before the end of the year.”

Investors have also been watchful of China-U.S. relations after the two economies slapped punitive import tariffs on products from the other in recent weeks, and of geopolitical developments related to the U.S. and Russia after the former led a missile strike in Syria recently.

Trading in Hong Kong- and Shenzhen-listed ZTE was halted on Tuesday after the U.S. banned American companies from selling components to the Chinese telecommunications-equipment maker and the U.K. warned of national security risks from the use of ZTE equipment or services.

Leshi Internet Information & Technology jumped 9.9% in Shenzhen. China Evergrande Group’s Hong Kong-based fund has invested about $300 million in a Faraday Future offshore unit in 2017, according to a Reuters report, citing Tencent’s news portal. Leshi’s top shareholder, Jia Yueting, the founder of the company’s Chinese parent LeEco, has an investment in Faraday Future. China Evergrande shares fell 3.7% in Hong Kong.

China Shenhua Energy dropped 1.6% following an 8.7% decline in March commercial coal production.

Chow Tai Fook Jewellery Group surged 7.1% to HK$10.44, its highest since September 2014, after saying retail sales value rose 13% in mainland China the during March quarter and 11% in Hong Kong and Macau.

The Nikkei Asia300 ASEAN Index of Southeast Asian companies ended 0.5% lower.

Singapore’s gauge rose 0.3% after data released Tuesday showed the city-state’s non-oil exports unexpectedly fell 2.7% in March. However, the figure was better than February's revised contraction of 6%, its first decline after four months of growth.

On a month-on-month seasonally adjusted basis, non-oil exports decreased by 1.8% in March, narrowing from the previous month's 2.7% decline, the report said.

Malaysia’s index shed 0.3%. Consumer sentiment in Malaysia gained 8.4 points to 91 in the first quarter, but remained below the optimism threshold, a state-backed think tank Malaysian Institute of Economic Research said Tuesday.

- By V. Phani Kumar; phani.kumar@NikkeiNewsrise.com; +852 39605150
- Edited by Suzannah Benjamin
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