Global stocks declined drastically on Monday, as Asia and Europe recorded losses. The decline also spread to the dollar as it dropped to a five-week low, the euro also retreated, and gold climbed to levels not seen since April.
In Asia, traders reacted to the mixed batch of factory data from China. A private gauge of manufacturing activity (the RatingDog index) came in at 50.5 for August, barely signaling growth. That was a slight improvement from July’s 49.5. But the government’s own official PMI, released a day earlier, stayed stuck under 50 at 49.4, up marginally from the previous 49.3.
Both readings showed China’s factory sector is far from recovering in full. At the Shanghai Cooperation Organization’s two-day security summit, Chinese President Xi Jinping urged member nations to “strengthen cooperation in artificial intelligence.” Giving his opening address, Xi added that the group should reject what he described as a “Cold War mentality.”
Stocks experience decline as the dollar and gold slump
The Hang Seng index in Hong Kong closed 2.17% higher at 25,617.42, led by a strong showing from Alibaba Group, which jumped 18.58%. CSPC Pharmaceutical Group surged 9.53% and WuXi Biologics rose 8.37%. On the mainland, the CSI 300 gained 0.6% and ended the session at 4,523.71, despite volatile trade. Japan’s Nikkei 225 slid 1.24% to 42,188.79, weighed down by semiconductor losses.
Advantest lost 7.92%, Disco Corporation dropped 7.71%, and Socionext fell 6.32%. The broader Topix also declined 0.39%, finishing at 3,063.19. Meanwhile, in South Korea, the Kospi lost 1.35%, ending at 3,142.93, while the Kosdaq slipped 1.49% to 785. Australia wasn’t spared either. The S&P/ASX 200 dropped 0.51%, closing at 8,927.70. Only India bucked the trend. The Nifty 50 gained 0.66% and the BSE Sensex climbed 0.6% as of early afternoon.
In the United States, Trump took a legal hit on Friday after a Federal Appeals Court ruled that his 2023 “reciprocal tariffs” breached presidential authority. The court declared the sweeping levies on imports from dozens of nations unlawful. Wall Street had ended last week in the red. The S&P 500 fell 0.64% to 6,460.26 but still locked in its fourth straight monthly gain. The Nasdaq Composite dropped 1.15% to 21,455.55, and the Dow Jones gave up 92.02 points to close at 45,544.88.
All three indexes responded to new inflation readings that showed price pressures remain stubborn. U.S. markets stayed closed Monday for Labor Day. In metals, gold rallied hard. Spot prices hit $3,486.86 per ounce, rising 1.2% as of 0641 GMT. Futures for December delivery moved up 1.1% to $3,554.60. The gains came as traders placed bigger bets on a Fed rate cut this month. Silver broke $40 for the first time since 2011, hitting $40.56. Platinum jumped 1.5% to $1,384.68. Palladium gained 0.8%, reaching $1,118.06.
