Asian Stocks Slide as Santa Claus Rally Fizzles on Wall Street
Asian markets fell as Wall Street’s holiday rally lost steam, raising concerns over economic challenges and profit-taking among investors
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On Monday, the main US indices dropped about one percent, following a rough Friday. Tesla and Meta both saw significant declines, which added to the overall gloom.
Even though trading volumes were low, brokers noted that many were locking in gains, especially after a great year for big tech companies.
Concerns about the Federal Reserve’s slow interest rate cuts and uncertainty over incoming president Donald Trump’s tariff plans were also dampening spirits.
In Asia, particularly in China, tariffs might seem manageable, but the economic issues run deeper. China is facing serious challenges with domestic consumption and setbacks in its tech sector.
Recent data showed that China’s manufacturing index was slightly up, indicating some growth, thanks to increased policy support.
Tokyo was closed for the day, but the Nikkei 225 had a strong year-end close, the best since the 1990s.
Among major Asian markets, the Hang Seng was the only one to rise, while stocks in China, South Korea, and Australia fell.
In other news, South Korea dealt with the aftermath of a tragic plane crash that killed 179 people, with families receiving the first bodies on Tuesday.
Boeing shares took a hit on Wall Street but managed to recover later. Jeju Air also saw a significant drop in its stock price.
On the political side, a South Korean court issued an arrest warrant for the impeached president, adding to the country’s turmoil.