Chennai [Tamil Nadu]: Asian equities traded in a narrow range on Tuesday morning as investors weighed weak economic signals from China against uncertainty over a possible US government shutdown. The cautious sentiment was reflected across regional benchmarks, with selective buying offset by concerns over slowing growth and policy risks.
Market performance and key indices
The MSCI Asia-Pacific index (excluding Japan) was up around 0.3%, with most regional indices posting modest gains. Japan’s Nikkei 225 was flat to slightly higher, while Hong Kong’s Hang Seng hovered near its previous close. Shanghai’s Composite Index rose about 0.4%, despite disappointing factory activity readings.
Economic signals from China
China’s official manufacturing PMI for September slipped to 49.8, marking the sixth consecutive month of contraction and signalling persistent stress among state-backed enterprises. Meanwhile, a private services survey indicated growth at 52.9, a slight slowdown from August, with employment falling at its fastest rate in over a year.
While export demand offered limited support, domestic weakness continued to weigh on investor sentiment, prompting cautious trading in regional markets.
Commodities and currencies
Gold prices touched record highs, bolstered by safe-haven demand amid global policy uncertainty. In contrast, crude oil prices declined on expectations of higher OPEC+ supply and resumed Kurdish exports, impacting energy stocks in some markets.
Currency markets were volatile, with the yen remaining weak, benefiting Japanese exporters, and the Chinese yuan under renewed pressure. The Indian rupee traded near record lows against the US dollar, in line with regional peers.
US government shutdown concerns
Investors remained alert to developments in Washington, where the risk of a US government shutdown could delay key economic data releases, including the September jobs report. Ongoing trade frictions also contributed to the cautious tone, limiting risk appetite across Asian markets.
Outlook
Analysts expect regional indices to remain rangebound until clearer global signals emerge. Selective buying may continue, but concerns over slowing Chinese growth, falling oil prices, and US fiscal uncertainty are likely to keep volatility elevated in the near term.