Asia-Pacific industries bearing brunt of China's slowdown, says S&P

HONG KONG - China's economic slowdown is influencing five key business conditions (the five Cs) in Asia-Pacific: commodity prices, currencies, capital flows, business and consumer confidence, says ratings agency Standard & Poor's.

The slowdown in China has hit business confidence and commodity prices, affecting Asia-Pacific miners and oil companies, and a drop in investor confidence has prompted a sell-off in Asia-Pacific currencies,exposing corporates to currency risk and potential capital flight, according to the agency. 

S&P analyst Terry Chan says Asia-Pacific's metals and mining sector has felt the largest shock – because China consumes 40-50% of total global raw material production.

“We grouped industries based on the extent of the crunch,” says Chan. “The region's automotive, chemicals, gaming, metals and mining, and technology bore the brunt of the impact. Sectors experiencing an intermediate impact include building materials, capital goods, consumer products, financial institutions, oil and gas, real estate development, retail, and transport–cyclical.

“Meanwhile, the insurance, public finance, real estate investment trusts, structured finance, telecommunications, transport–infrastructure, and utilities felt the least impact.” www.standardandpoors.com (ATI).