Tokyo’s Nikkei dipped more than 12%, Seoul and Taipei plummeted more than 8% each, Singapore gave up nearly 5% and Sydney more than 3%, while Hong Kong and Shanghai slid more than 1%
Tokyo led a collapse across Asian and European equities Monday, after weak US jobs data raised concerns of a recession in the world’s biggest economy and boosted bets on several Fed interest rate cuts.
Trading boards were in the red following another hefty day of losses on Wall Street, where heavyweight tech companies including Amazon and Microsoft took the brunt over concerns an AI-fuelled rally this year may have been overdone.
A much-anticipated report Friday showed the US economy added just 114,000 jobs last month, well down from June and far fewer than expected, while the jobless rate rose to the highest level since October 2021.
The news came a day after lacklustre factory data that stoked concerns that Federal Reserve may have held borrowing costs at more than two-decade highs too long.
That has led to speculation the economy could be in for a hard landing and tip into recession.
Some analysts pointed to the “Sahm rule”, which says an economy is in the early stages of recession if the three-month moving average of unemployment is 0.5 percentage points above its low over the previous 12 months. That was sparked by Friday’s data.
The losses in New York were followed in Asia, with Tokyo’s Nikkei dipping more than 12% in its worst day since the Fukushima crisis in 2011. It also suffered its biggest points loss, slipping 4,451.28.
Seoul and Taipei plummeted more than 8% each, while Singapore gave up nearly 5% and Sydney more than 3%.
Futures trading was temporarily suspended on the Nikkei and Topix indexes, on the Osaka Exchange and in Seoul in a bid to ease volatility.
Hong Kong and Shanghai slid more than 1%, with traders brushing off a set of directives released by China aimed at boosting household consumption in the world’s number two economy.
There were also big losses in Mumbai, Bangkok, Manila, Jakarta and Wellington.
London, Frankfurt and Paris each dropped more than 2%.
