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Asia stocks follow US shares lower
[SINGAPORE] Asian stocks dropped for a second day, tracking a decline in US equities, as investors awaited Chinese inflation data amid renewed concern about the slowdown in the world's second-largest economy.
The MSCI Asia Pacific Index fell 0.4 per cent to 132.35 as of 9.00 am in Tokyo. Global equities snapped their longest rally since February on Tuesday and the Standard & Poor's 500 Index fell from a seven-week high amid a plunge in Chinese imports. Investors will be watching Wednesday's consumer and producer prices data to gauge how weakness in China's economy will impact the global economic outlook.
"The cautionary element in the market is likely to continue," Chris Green, an Auckland-based strategist at First NZ Capital Ltd, said by phone. "In terms of global growth the risk is skewed towards the downside. A softer read on the Chinese inflation data reinforces the backdrop of deflationary pressures and a softer growth profile globally. The Chinese economy is probably the largest risk that the global economy faces." Japan's Topix index lost 0.8 per cent. South Korea's Kospi index slid 0.3 per cent. Australia's S&P/ASX 200 Index fell 0.3 per cent. New Zealand's S&P/NZX 50 Index added 0.4 per cent.