Asian Markets Plummet Amid Global Economic Concerns and Fed Meeting Anticipation

On Monday, Asian stock markets declined sharply due to lower-than-expected US payroll growth and the approaching Fed meeting. Japan's Nikkei 225 and Hong Kong's Hang Seng saw significant drops, exacerbated by concerns over China and Germany's economic slowdowns. Despite global turmoil, Indian markets remain buffered by domestic investor strength.

Asian stock markets took a steep dive early Monday as selling pressure intensified following disappointing US payroll growth and the impending Federal Reserve meeting. Japan's Nikkei 225 index dropped 1.84%, or 632 points, while Hong Kong's Hang Seng fell 1.73%, or 301 points.

Experts attribute the heightened selling pressure to concerns over economic slowdowns in China and Germany. 'We are witnessing eight days of volatility ahead of the Fed rate cut scheduled for September 18,' said Ajay Bagga, Banking and Market expert. 'Seasonal poor performance of markets in September, coupled with slowdowns in China and Germany, are adding to global growth worries.'

Taiwan's major index, Taiwan Weighted, saw a 2% decline, and South Korea's KOSPI index fell by 1.15%, indicating a widespread selling sentiment among investors in Asian markets. However, experts noted that Indian stocks might see less impact due to strong domestic investor activity, although some volatility is expected.

'The impact on Indian markets is mainly through Foreign Institutional Investors (FII) selling,' Bagga added. 'Despite net FII outflows from January 2022 to August 2024, robust domestic inflows have stabilized the market. We expect some volatility over the next couple of weeks but don't foresee sharp declines.'

Indian stock indices also felt the heat on Friday, with all sectoral indices closing deep in the red. The Nifty 50 fell by 292.95 points, or 1.17%, to 24,852.15, and the BSE Sensex dropped 1,017.23 points, or 1.24%, to 81,183.93. 'U.S. market weakness has stalled momentum in Indian markets, making participants cautious ahead of the upcoming jobs data,' said Ajit Mishra, SVP, Research, Religare Broking. Global market weakness and foreign investor selling have dented domestic sentiment.

(With inputs from agencies.)