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Nikkei Markets

Asian stocks tumble as global growth worries reappear on weak China, US data

Hong Kong-listed Chinese companies pace losses on A300 Index

HONG KONG (Nikkei Markets) -- Asian shares tumbled on Friday after global economic growth concerns resurfaced amid disappointing U.S. retail sales data and lower-than-expected China inflation.

The Nikkei Asia300 Index of companies declined 1.4% to 1,280.79. The gauge was down 0.3% for the week with Friday's decline wiping off the index's accumulated advance through Thursday.

Regional equities were pressured on Friday by lower-than-expected increase in producer prices and consumer prices in Asia's largest economy. China's consumer prices rose by 1.7% on-year in January and producer prices increased by 0.1%, down from 1.9% and 0.9%, respectively, in the previous month.

"Today's inflation data bodes ill for industrial utilization rate and the profit outlook of local Chinese enterprises as well as the manufacturers of producer goods," ANZ Research said in a note.

Hong Kong-shares of Chinese companies were the biggest contributors to the losses on the A300 Index. Bank of China, China Construction Bank, and Industrial and Commercial Bank of China declined at least 2.3%. Anhui Conch Cement fell 3.7%, Fosun International declined 3.4%, and China Life Insurance dropped 2.6%. Great Wall Motor fell 2% after reporting a 16.5% month-on-month decline in car sales volume for January.

Risk appetite on Friday was further hurt by U.S. retail sales data. On Thursday, data showed a 1.2% month-on-month fall in January retail sales, which according to calculation by Reuters, is the biggest drop in more than nine years. Excluding automobiles, gasoline, building materials, and food services, a more-closely followed measure, retail sales dropped 1.7% last month, reportedly the biggest fall since September 2001.

U.S. 10-year yield fell to 2.65% on Thursday following the data. The S&P 500 Index declined 0.3% and the dollar index lost 0.2%.

Meanwhile, the news flow regarding the ongoing U.S.-China trade talks was not particularly encouraging. Bloomberg reported, citing people familiar with discussions, that the two countries "have made little progress so far" during talks in Beijing, while The Wall Street Journal reported that the U.S. and China remain deadlocked on a number of issues underlying their trade dispute.

In other movers on Friday, Singapore-listed Thai Beverage jumped 13.2% after reporting a 150% jump in profit attributable to shareholders for the October-December period.

Oil & Natural Gas Corp. rose 2.3% after the Indian energy company reported a better-than-expected 65% rise in net profit for the December quarter.

Singapore Airlines declined 1.1% after posting a 27% decline in net profit for the three months ended December 31 amid higher net fuel costs.

Maxis declined 1.2%. The Malaysian mobile phone operator on Friday reported a 50% fall in net profit for the December quarter.

In major economic data out on Friday, Singapore reported economic growth of 1.9% for the December quarter, lower than the 2.1% expected by economists polled by Reuters.

--Nimesh Vora

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