HONG KONG: Asian markets mostly fell Monday (Feb 24) following a dour end to last week for Wall Street, where a disappointing round of data added to concerns about the world's number one economy.
The euro started on the front foot after conservatives won a closely watched election in Germany, with leader Friedrich Merz urging the speedy formation of a new coalition government.
After a healthy performance on Friday, Asian investors struggled to maintain momentum after big losses in New York, where the Nasdaq lost more than two per cent.
The selling came after a report showed activity in the key services sector hit a 25-month low in February, while separate data indicated consumer sentiment dived almost 10 per cent from January.
Meanwhile, another study revealed that expectations for inflation hit a three-decade high.
The readings follow a recent run of figures pointing to a softening of the labour market and prices continuing to rise faster than the Federal Reserve's target rate.
There have been increasing fears since Donald Trump regained the US presidency that his plans to impose import tariffs, and slash taxes, immigration and regulations would reignite inflation.
That has led investors to scale back their expectations for how many interest rate cuts the Fed will make this year.
Hong Kong advanced in early Asian trade, building on Friday's blockbuster rally fuelled by tech firms, particularly an eye-watering rise of more than 14 per cent in ecommerce titan Alibaba.
The Chinese firm piled on more than one per cent, while JD.com was up 0.9 per cent.
However, while Singapore also edged up the rest of the region struggled.
Shanghai, Sydney, Seoul, Taipei, Manila, Jakarta and Wellington were all in the red.
The euro got a lift from news that Merz's CDU/CSU alliance won more than 28 per cent, according to projections, crushing the Social Democrats (SPD) of outgoing Chancellor Olaf Scholz, which came third.
The far-right Alternative for Germany (AfD) came second, almost doubling its score to over 20 per cent.
Merz said he wanted to quickly form a government, warning that as Trump is driving rapid and disruptive changes, "the world isn't waiting for us".
"Markets will like that, presuming it is achieved," said National Australia Bank's senior forex analyst Rodrigo Catril.
Oil prices extended losses after dropping as much as three per cent on Friday as the weak US data sparked demand fears, while there are also growing expectations Trump will ease the sanctions that have limited Russian oil exports. - AFP
