The MSCI World index fell 0.5% – not a big deal, perhaps, but the second weekly decline in a row and the steepest since the U.S. banking crisis blow-up two months ago.
Asian shares ex-Japan, however, inched up for a second weekly rise in a row, also something not seen since early March.
If U.S. tech stocks are flying – the Nasdaq rose for a third week and Wall Street’s rally this year is entirely thanks to AI-centric stocks, according to SocGen – Asian tech is stuck in quicksand.
The Hang Seng tech index fell last week for a sixth straight week, its longest losing streak since mid-2015 when the first tremors of the Chinese stock market earthquake were felt and only weeks before Beijing devalued the yuan.
The latest Chinese economic indicators have been shocking. Inflation and imports collapsed in April, casting severe doubt over the strength of the economy’s post-lockdown recovery and ramping up expectations of more policy easing.
Industrial production, retail sales and fixed asset investment data for April this week will paint a fuller picture. More sub-par numbers will likely increase the selling pressure on Chinese stocks – the Shanghai composite had its worst week since March, while the blue chip index fell for a fifth week and also had its biggest weekly fall in two months.
