BANGKOK (AP) — Global Shares Decline

In a notable shift on Monday, world shares mostly declined as U.S. stocks stepped back from their recent all-time highs. The dip comes amidst a backdrop of several Asian markets being closed for holidays.

European Market Declines

In early European trading, significant declines were observed, with Germany's DAX index falling by 1.1% to 21,178.37. Similarly, France's CAC 40 dropped 0.8% to 7,863.70, and Britain's FTSE 100 saw a slight decrease of 0.3% landing at 8,473.33.

U.S. Futures Also In Red

Futures for key U.S. indices were also in the red, with the S&P 500 futures falling by 1.6% and the Dow Jones Industrial Average futures decreasing by 0.9%.

Hong Kong's Unique Surge

Interestingly, shares in Hong Kong experienced an uptick, driven by news surrounding a Chinese artificial intelligence startup, DeepSeek. This emerging AI model promises lower investment thresholds compared to traditional models, prompting a sell-off in U.S. and Japanese tech stocks while boosting investments in Chinese tech firms. Hong Kong’s Hang Seng index rose by 0.7% to 20,197.77, with notable gains in e-commerce giant Alibaba, which surged 2.9%, and search engine leader Baidu, which skyrocketed by 4.9%.

Challenges in Chinese Markets

Conversely, the Shanghai Composite index fell by 0.1% to 3,250.60, following a troubling report indicating that Chinese export orders had experienced a drop to a five-month low. The official manufacturing purchasing managers index (PMI) slid from 50.1 in December to 49.1 in January, marking a contraction. This decline was corroborated by decreases in new orders and construction PMIs. Analysts like Zichun Huang from Capital Economics suggest that despite the downturn, a rebound may be on the horizon due to increased government spending and the typical factory slowdowns that precede the Lunar New Year holidays, which commence on Tuesday.

Japan's Market Reaction

In Japan, the Nikkei 225 index decreased by 0.9% to 39,565.80, extending a trend of losses following the Bank of Japan’s decision to raise its benchmark interest rate to 0.25%, the highest rate since 2008. The technology sector was particularly hard hit, with shares of Tokyo Electron falling 4.9% and test equipment manufacturer Advantest plunging by 8.6%.

Currency Market Stability

Currency markets showed signs of stability with the U.S. dollar holding steady against the Japanese yen at 155.45, down slightly from 155.72. The euro also slipped to $1.0477 from $1.0483.

Impact of Holidays in Asia

In Bangkok, the SET index declined by 0.7%, reflecting the broader trend of investor caution. Many other Asian markets remained closed for holidays, leading to reduced trading activity.

U.S. Market Pullback

As a final note, the previous Friday marked a pullback for U.S. markets after a period of record highs, with the S&P 500 ending the day down 0.3% at 6,101.24, while the Dow Jones Industrial Average and Nasdaq composite followed suit with similar reductions of 0.3% and 0.5%, respectively. These adjustments signal a pivotal moment for investors globally, as they evaluate potential impacts amid shifting economic indicators and policy changes.