Investing.com -- Asian stocks have recorded a fourth session fall, driven by lowered expectations of the Federal Reserve's interest rate cuts and a continuous selloff of Chinese shares. The MSCI Asia Pacific excluding Japan Index experienced a decrease of up to 1.7%, marking its lowest point since August of the previous year.
Major contributors to this decline included TSMC, Samsung Electronics (KS:005930) and Hon Hai (TW:2317). The sharpest drops in the region were seen in Taiwan and the Philippines, while Indian stocks also suffered as the rupee reached a new low. Meanwhile, Japanese markets were closed due to a holiday.
The fall in Asian markets has been exacerbated by stronger than predicted US jobs data, which has led to a reassessment of the Federal Reserve's rate cut expectations for the current year. Chinese stocks have been particularly affected, with increasing trade tensions under the Trump administration pushing the MSCI China Index into a bear market last week.
The weak start to the year is a result of investors reducing risk and taking profit in China following last year's strong performance.
Investors are now keen to see if policy support will stimulate the economy, especially after China's central bank promised on Monday to increase its support for the yuan and enhance its management of the foreign exchange market. The yuan is currently trading near an all-time low after a months-long decrease against the dollar.
Despite data showing a 10.7% increase in exports in December, exceeding expectations, and total shipments for the year reaching a record of $3.6 trillion, Chinese stocks continue to stay in the negative.
However, strategists from Goldman Sachs Group Inc (NYSE:GS). have expressed a continued bullish stance on Chinese stocks, despite the ongoing rout, predicting an approximate 20% rise in benchmarks by the end of the year.
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