Asian stocks fell on Aug. 16 as traders braced for China’s economic slowdown brought by COVID-19 concerns and domestic issues.
The Hang Seng Index, often used as an indicator for China’s growth, lost more than 9 percent of its value during the second quarter.
Technology giants Xiaomi, Alibaba, and Tencent fell by around 2.4 percent as Beijing continues to crack down on its tech industry.
Julian Evans-Pritchard, senior China economist at Capital Economics, said that China’s economic data reflected not only coronavirus concerns but also the effects of rigid monetary policies on investment and industrial activity.
China’s economy grew by 7.9 percent during the second quarter, falling short of analysts’ median expectation of 8 percent.
Industrial output, a large chunk of China’s gross domestic product, increased by 6.4% in July from the previous year.
According to a Bloomberg survey, analysts initially expected 7.8 percent after June saw an 8.3 percent increase.
Retail sales, a key indicator of domestic consumer spending, dropped from 12.1 percent in June to 8.5 percent in July — lower than the projected 10.9 percent.
“The uncertainties in market regulation may also be weighing down short-term consumer and investor sentiment,” said JP Morgan strategist Chaoping Zhu, maintaining that export growth could help offset domestic issues and support China’s aggregate growth.