An earlier version of this report misstated the job title of Michael Workman, a senior economist at the Commonwealth Bank of AustraliaAsian markets were broadly lower Friday, tracking overnight declines on Wall Street as participants eased into the holiday season.
The Shanghai Composite Index SHCOMP, -0.94% ended down 0.9%, Australia’s S&P/ASX 200 XJO, -0.28% closed 0.3% lower, and Hong Kong’s Hang Seng Index HSI, -0.28% was off 0.3%. Japan’s stock market was closed for a holiday.
“You’re coming closer to the Christmas holiday,” said Hue Lu, senior investment specialist at BNP Paribas Investment Partners. “[Traders] want to bring down the risk. They don’t want any surprises.”
Many key Asian markets will be closed Monday to observe the Christmas holiday, while a few will remain closed on Tuesday. Markets in Japan, China, India and South Korea will be open.
Read: When are European markets closed for Christmas and New Year’s holidays?
Stocks in the U.S. were weaker Thursday amid a mixed deluge of data releases, with the Dow Jones Industrial Average DJIA, -0.12% ending down 0.1% and the Nasdaq retreating 0.4%.
While gross domestic product expanded 3.5% in the previous quarter—a faster rate than previously expected—U.S. household spending rose just 0.2% in November from the month before, slowing from the previous two months, and incomes flatlined.
The personal-income and spending data out of the U.S. interrupt a run of strength, said Ric Spooner, chief market analyst at CMC Markets.
“Any more of moderate or softer data [and] we could just start seeing…selling and profit-taking in the new year,” Spooner said.
How credit scores predict what you will buy nextFor decades, FICO has used big data and mathematical algorithms to calculate people's three-digit credit scores. Now it's using the same technology to predict whether a consumer's likely to buy a product in-store or click on a link online.
Among the major stock decliners, Cheung Kong Property 1113, -1.86% ended down 1.9%, while Hang Lung Property 0101, -1.23% fell 1.2% and the Bank of East Asia 0023, -1.49% lost 1.5%.
Meanwhile, a liquidity squeeze in Chinese and Hong Kong markets has affected buyer interest, said Hannah Li, a stock strategist at UOB Kay Hian, adding that a weaker yuan would hurt Chinese companies’ profits.
“With interest rates expected to rise in the U.S., the yuan is expected to weaken and will hurt the margins of Chinese firms,” said Li.
Other Asian currencies were paring losses against the U.S. dollar on Friday amid further profit-taking on the dollar’s recent gains. The dollar was recently down 0.5% against the Singapore SGDUSD, +0.3772% and 0.1% lower against the Korean won KRWUSD, +0.039841% .
Australian banks fallAustralian shares pulled back on Friday from a rally this week. A slip by major banking stocks as well as losses among mining companies weighed on the broader market.
National Australia Bank NAB, -0.49% led the big banks lower, falling 0.5%, while Commonwealth Bank of Australia CBA, -0.23% fell 0.2% and Westpac Banking WBC, -0.12% edged down 0.1%.
More broadly, analysts say markets globally aren’t pricing in near-term risks. The CBOE Volatility Index VIX, +0.00% , often touted as the stock market’s fear gauge, dropped to its lowest intraday level since August 2015 on Wednesday, indicating that investors weren’t pricing big risks.
With President-elect Donald Trump’s rhetoric rising again and troubled Italian lender Banca Monte dei Paschi di Siena failing to raise money from private investors, markets are at a risk of not being prepared for the worst, said Daniel Morris, a senior investment strategist at BNP Paribas Investment Partners.