BANGKOK (AP) — Concern over China’s slowdown weighed on Asian stocks Monday while European markets regained their footing after last week’s stronger-than-expected U.S. jobs report.
The U.S. hiring report Friday added to the likelihood the Federal Reserve will begin winding down its massive stimulus effort this year. Speculation about the Fed’s timing has contributed to big swings in world markets for weeks.
Most Asian markets fell amid renewed worries that economic recovery in China, the world’s No. 2 economy, is faltering.
Hong Kong’s Hang Seng closed down 1.3 percent at 20,582.19. Mainland Chinese shares sank with the Shanghai Composite Index down 2.4 percent to 1958.27. The smaller Shenzhen Composite Index lost 3.6 percent to 889.53.
“There is just no support for the market to rise, and the trend of going down won’t be changed in the longer term based on the economic outlook,” said Guo Yanhong, an analyst at Huachuang Securities in Beijing.
IMF Director Christine Lagarde warned at a conference in France on Sunday that a slowdown in emerging economies could result in the fund lowering its 2013 forecast for world growth, Societe Generale said in a research report.
The Chinese central bank’s clampdown on easy credit has also fueled concerns about China’s faltering economic recovery.
Peter Elston of Aberdeen Asset Management said a deeper problem is that China can no longer rely on its cheap manufacturing and easy government credit to maintain its rapid pace of expansion.
“What is happening now with China is that people are beginning to suspect that it may have reached the limits of that growth model,” Elston said.
Japan’s Nikkei 225 fell 1.4 percent to 14,109.34. South Korea’s Kospi dipped 0.9 percent to 1,816.85. Taiwan’s TAIEX fell 1.4 percent to 7,886.34 and Indonesia’s JSX was down 3.9 percent to 4,433.63.
In Europe, early trading was more optimistic after Friday’s strong U.S. jobs report. Germany’s DAX was up 1.6 percent to 7,933.60 and France’s CAC-40 gained 1.6 percent to 3,811.94. Britain’s FTSE 100 inched up 0.2 percent to 6,437.16.
Wall Street was set to gain with Dow futures up 0.4 percent at 15,143. Broader S&P 500 futures rose 0.5 percent to 1,635.70.
World markets have been volatile in recent weeks as investors worried that an improving U.S. economy would convince the Federal Reserve to scale back a bond buying program that has kept interest rates low and sparked an influx of money into stocks in search of better returns.
Those worries were put aside by Wall Street on Friday after the Labor Department reported that U.S. employers added a stronger-than-expected 195,000 jobs last month, suggesting the economy is healthy enough to cope with a withdrawal of the Fed’s stimulus.
The Dow Jones industrial average rose 147.29 points to 15,135.84. The S&P 500 rose 16.48 points to 1,631.89. The Nasdaq composite climbed 35.71 to 3,479.38.
Benchmark crude for August delivery was down 32 cents to $102.88 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained $1.98 to $103.22 on Friday.
In currencies, the euro rose to $1.2845 from $1.2828 late Friday. The dollar rose to 101.32 yen from 101.05 yen.