Stock markets globally are growing at different rates while inflation concerns persist
The global stock market is experiencing different growth movements as key inflation markers remain positive in many regions. In Hong Kong, the Hang Seng Index (INDEXHANGSENG: HSI) decreased by 2.22% after losing a massive 411 points, currently sitting at 18,183.80. Although the Hang Seng Index is lagging behind all other Asian stock indices, it has officially entered a bear zone with its current performance.
In what appears to be a coordinated move, the Shanghai Composite SSE Composite Index (SHA: 000001) fell by 0.61% to 3,204.56 while the Shenzhen Component SZSE Component Index (SHE: 399001) also dropped by 0.70% to 10,793.85. The decline in the Chinese stock indices was fueled by China’s latest manufacturing purchasing managers index, which fell below expectations.
This index was set at 48.8 for the month of May, a figure which is below the 49.2 recorded in April. Other key markets in the Asia Pacific region also experienced bearish growth, with the Japanese TOPIX (INDEXTOPIX: TOPIX) dropping by 1.32% to 2,130.63. The decline in the TOPIX can be seen as a good correction, given that the index recently rose to a multi-decade high.
The index is seeing massive growth strides from Japanese stocks, a move that has prompted market analysts to project a positive outlook for the market in the long term. The current slip in the TOPIX was also seen in the Nikkei 225 (INDEXNIKKEI: NI225), which fell as much as 1.41% to 30,887.88.
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Of the key markets in the Asia Pacific region, only the South Korean Kosdaq saw a slight uptick with growth of 0.64% to 856.94.
Global Stock Market Moves, the Concession
From indications, the bearish uncertain moves in the global stock market may stick around for some time, as countries begin to navigate the impact of monetary policies in the bid to fight inflation.
In Australia, the weighted inflation gauge rose more than expected to 6.8%. According to analysts polled by Reuters, an inflation rate of 6.4% is what is expected, implying that the central bank’s efforts to tame this unpleasant rise in the cost of living is not having much effect.
The United States has also seen a major decline, with the Dow Jones Industrial Average (INDEXDJX: .DJI) dropping by 0.15% to 33,042.78. The Nasdaq Composite (INDEXNASDAQ: .IXIC) and the S&P 500 Index (INDEXSP: .INX) surprisingly recorded upticks. While the former surged by 0.32% to 13,017.43, the latter’s growth remains marginally positive.
The fight against inflation in the US is far from being won, but when compared to other major economies, the figures are relatively better. Inflation was set at 4.9% in the month of April, and the Federal Reserve has continued to raise interest rates in hopes that inflation will return to its desired level at 2%.
