Asian stocks sink on German inflation, British tax cuts

Asian stocks sink on German inflation, British tax cuts


BEIJING (AP) — Asian stocks sank again Friday after German inflation spiked higher, British Prime Minister Liz Truss defended a tax-cut plan that rattled investors and Chinese factory activity weakened.

Shanghai, Tokyo, Hong Kong and Sydney retreated. Oil prices edged lower.

Wall Street's benchmark S&P 500 index fell 2.1% on Thursday to its lowest level in almost two years after strong U.S. jobs data reinforced expectations the Federal Reserve will stick to plans for more interest rate hikes.

Investors increasingly worry the global economy might tip into recession following interest rate hikes by the Fed and central banks in Europe and Asia to cool inflation that is at multi-decade highs. Global export demand is weakening and Russia's attack on Ukraine has disrupted oil and gas markets.

Markets slipped Thursday after Germany reported September inflation accelerated to 10.9% and Chancellor Olaf Scholz said the world's fourth-biggest economy faces a “double whammy” as energy prices surge.

“We'd be inclined to argue that we haven’t yet seen the bottom,” said ING economists in a report.

The Shanghai Composite Index lost 0.2% to 3,034.84 after surveys of manufacturers showed factory production, new export orders and manufacturing employment declined in September.

The Nikkei 225 in Tokyo fell 2.3% to 25,835.54 and the Hang Seng in Hong Kong declined less than 0.1% to 17,154.48. The Kospi in Seoul lost 0.3% to 2,164.63.

Sydney's S&P ASX 200 sank 1.2% to 6,479.00 while India's Sensex opened up 0.3% at 56,596.99. New Zealand and Southeast Asian markets declined.

Investors already were uneasy about signs global activity was weakening before Truss's government announced multibillion-dollar tax cuts. Traders worry that will push up already high inflation, forcing the...

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