SINGAPORE – Asian markets slid broadly in Monday trade, as investors reacted to the release of Chinese economic data, including first-quarter gross domestic product figures.
In Japan, the Nikkei 225 fell 1.5%, while shares in Fast Retailing fell nearly 2%. The Topix Index lost 1.22%.
Mainland China equities were also lower, with the Shanghai Composite down 0.78% and the Shenzhen Component down 0.2%.
China posted faster-than-expected GDP growth in the first quarter, data released by the National Bureau of Statistics on Monday showed. China’s GDP grew 4.8% in the first quarter, beating expectations for a 4.4% year-on-year increase.
Retail sales, however, fell a more-than-expected 3.5% year-on-year in March. That contradicted expectations of a 1.6% decline in a Reuters poll.
The data comes as mainland China has been battling its worst Covid wave in two years for weeks. The city of Shanghai in particular is one of the most affected areas.
“We know that a big driver of consumer weakness is the zero-Covid policy,” Johanna Chua, head of Asia economics and strategy at Citi Global Markets Asia, told CNBC’s Street Signs Asia on Monday.
“We had President Xi Jinping’s statement in Hainan, where he pointed out that perseverance is key, so they will stick with damage consumption,” Chua said.
South Korea’s Kospi outperformed the broader region, rising 0.67%. MSCI’s broadest index of Asia Pacific equities outside of Japan traded 0.62% lower.
Asian markets may “move cautiously to start the week” as investors digest Friday’s announcement by the People’s Bank of China of a reserve requirement ratio cut on April 25, analysts at Singapore-based OCBC Treasury Research wrote in a note dated Monday. The RRR is the amount of funds banks are required to hold in reserve.
“This is the smallest cut since China announced reserve ratio reform in 1998,” the analysts said.
Stock picks and investment trends from CNBC Pro:
Currencies and Oil
The US Dollar Index, which tracks the greenback against a basket of its peers, came in at 100.682 and remains above the 100.4 level after a recent bounce from below 100.
The Japanese yen traded at 126.66 per dollar after depreciating from below 125 against the greenback last week. The Australian dollar was at $0.7362, lower from levels above $0.747 recorded last week.
Oil prices were higher in the afternoon of Asian session, with international benchmark Brent crude futures up 1.03% to $112.85 a barrel. US crude futures were up 0.92% to $107.93 a barrel.
— CNBC’s Evelyn Cheng contributed to this report.