While Asian stock market indices were trading in a mixed pattern, China's Shanghai Composite Index was down 4.11% at 2,653.41 on Monday (29 February) at 5.54am GMT, following worries from the G20 meeting and US Federal Reserve.
The policymakers at the G20 meeting, held in Shanghai, failed to come out with any action or solution that could spur global growth. Steven Englander, global head of G10 FX Strategy at CitiFX said: "The G20 communique basically says 1) the world is not as bad a place as markets think; and 2) if it gets worse we will use fiscal, monetary and structural policy aggressively to fix it. In baseball parlance, they were aiming for a single in terms of restoring confidence and they probably achieved it".
Adding to this woe was US data released on 26 February that revealed an increase in January consumer spending apart from a pickup in inflation by the most in four years. This positive data revived the Fed's chances of another rate hike in 2016. Bart Wakabayashi, head of forex at State Street said: "The US economy doesn't look too bad after all. So some people seem to start thinking that the Fed's rate hike could be back on the agenda."
Chinese investors also seemed to be hurt by disappointing earnings results released over the weekend and the latest cyberspace crackdown by Beijing. Indices in the rest of Asia traded as follows on 29 February at 6.08am GMT:
|Hong Kong||Hang Seng Index||19,078.88||Down||1.47%|
Meanwhile, last week, the Dow Jones Industrial Average closed at 16,639.97, down 0.34%, while the FTSE 100 closed higher by 1.38% at 6,096.01 on 26 February.
Among commodities, crude, which has been declining after it reacted negatively to recent statements by Saudi Arabian oil minister Ali al-Naimi, was trading higher. WTI crude oil was trading 0.18% higher at $32.84 (£23.67, €30.01) a barrel, while Brent was up 1% at $35.45 a barrel at 6.16am GMT on 29 February.