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Investing.com– Most Asian stocks moved in a flat-to-low range on Tuesday amid persistent concerns over slowing economic growth in China, while Indian stocks eyed new highs on the back of a positive earnings season. 

Regional financial stocks saw some buying ahead of key earnings from some of the biggest American banks this week, including Bank of America (NYSE:), Morgan Stanley (NYSE:) and Goldman Sachs (NYSE:).

Wall Street indexes also closed higher overnight, offering some positive cues to local stocks.

But this was largely offset by weak economic indicators from China, after data showed that growth in the country’s slowed in the second quarter. The reading triggered steep losses in Chinese stocks, which extended into Tuesday. 

Chinese stocks fall further, stimulus measures in focus

Hong Kong’s index was the worst performer in Asia on Tuesday, tumbling nearly 2% in catch-up trade after adverse weather conditions suspended trading on Monday.

Losses were concentrated in locally-listed Chinese real estate and technology stocks, with heavyweights including Baidu (HK:) (NASDAQ:), Alibaba Group Holding Ltd (HK:) (NYSE:) and Tencent Holdings Ltd (HK:) seeing a heavy dose of profit taking after strong gains last week.

China’s and indexes also fell about 0.4% each, extending losses from Monday. But their pace of losses somewhat slowed as the weak economic data pushed up expectations for more stimulus measures in China.
suggested that the People’s Bank of China could cut its key interest rates and bank reserve requirements in the third quarter, to unlock more liquidity. PBOC officials have also flagged more policy support in recent weeks.

But concerns over a Chinese slowdown weighed on most broader Asian markets. South Korea’s and the index shed 0.4% each, while Japan’s index fell slightly after a long weekend.

Australia’s fell 0.4% as the minutes of the Reserve Bank’s July meeting showed that the lender was still considering more rate hikes, despite a pause earlier this month.

Indian stocks at record highs amid positive earnings

Singapore-traded futures for India’s index pointed to a flat open on Tuesday, after both the Nifty and the notched record highs in the prior session.

Strength in conglomerate Reliance Industries Ltd (NS:), before the demerger of its financial services unit, and a rally in bank stocks, following strong results from lender  HDFC Bank (NS:), were the biggest drivers of Monday’s gains.

Robust foreign capital inflows, optimism over the Indian economy and a strong start to the second-quarter earnings season were the biggest drivers of a local stock market rally over the past month.

But analysts have warned that any negative news could trigger a heavy amount of capitulation in Indian stocks. 

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