Mkts in Asia fall as Japan GDP hits slow lane

Beijing: Shares fell Friday in Europe and Asia after Japan reported its economy grew less than earlier estimated in the last quarter. Germany’s DAX shed 0.5 per cent to 15,636.59 and the CAC 40 in Paris fell 0.5 per cent to 7,159.49. Britain’s FTSE 100 declined 0.4 per cent to 7,415.45. The futures for the S and P 500 and the Dow industrials edged 0.1 per cent higher.

Japan, the world’s third largest economy, grew at a 4.8 per cent annual pace in the April-June quarter, below the earlier estimate of 6per cent growth, according to data released Friday. Much of that growth was driven by exports, which rose nearly 13 per cent, while private consumption fell 2.2 per cent on weak investment spending. A separate report showed that wages declined in July for the 16th straight month, falling 2.5 per cent from a year earlier.

Tokyo’s Nikkei 225 index dropped 1.2 per cent to 32,606.84, while the Kospi in Seoul lost less than 1 point, to 2,547.68. Hong Kong’s markets were closed due to a tropical storm. The Shanghai Composite index shed 0.2 per cent to 3,116.72, while the S and P/ASX 200 fell 0.2 per cent to 7,156.70. On Thursday, Wall Street slipped in mixed trading Thursday as the threat of high interest rates continued to dog Big Tech stocks.

The S and P 500 fell 0.3 per cent and Nasdaq composite was hit particularly hard by the drop for tech stocks, sinking 0.9 per cent. The Dow Jones Industrial Average held up better than the rest of the market because it has less of an emphasis on tech. It rose 0.2 per cent. High interest rates drag stock prices, especially those of technology companies and others that have been bid up on expectations for high growth far in the future.

Many of those stocks also tend to be the most influential on the S and P 500 because they’re the biggest. Investors remain concerned over whether the Federal Reserve will keep interest rates high or raise them further if inflation does not continue to subside. In other trading Friday, US benchmark crude oil shed 32 cents to $86.55 a barrel in electronic trading on the New York Mercantile Exchange. It added 67 cents on Thursday.

Brent crude, the pricing basis for international trading, declined 22 cents to USD 89.70 a barrel. The dollar rose to 147.43 Japanese yen from 147.30 late Thursday. The euro was trading at $1.0713, up from $1.0697.