Asian stocks follow Wall St down on rate hike, economy fears

Oil prices fell more than USD 1 but stayed above USD 100 per barrel. Wall Streets' benchmark SP 500 index tumbled 3.2 percent on Monday, hitting its lowest point in more than a year. The Federal Reserve is trying to cool inflation that is running at a four-decade high, but investors worry that might trigger a US downturn.


PTI | Beijing | Updated: 10-05-2022 09:54 IST | Created: 10-05-2022 09:52 IST
Asian stocks follow Wall St down on rate hike, economy fears
Representative Image Image Credit: Piqsels
  • Country:
  • China

Asian stocks followed Wall Street lower on Tuesday as fears increased that US rate hikes to fight inflation might stall economic growth.

Market benchmarks in Tokyo, Hong Kong, Seoul, and Sydney fell. Shanghai advanced. Oil prices fell more than USD 1 but stayed above USD 100 per barrel.

Wall Street's benchmark S&P 500 index tumbled 3.2 percent on Monday, hitting its lowest point in more than a year.

The Federal Reserve is trying to cool inflation that is running at a four-decade high, but investors worry that might trigger a US downturn. That adds to pressure from Russia's war on Ukraine and a Chinese slowdown.

Traders are pricing in the "impending deterioration of economic conditions," said Yeap Jun Rong of IG in a report.

The Nikkei 225 in Tokyo lost 0.9 percent to 26,074.53 and Hong Kong's Hang Seng dropped 2.6 percent to 19,478.31.

The Shanghai Composite Index gained 0.4 percent to 3,017.21 after the Chinese government announced rent cuts and other aid for small businesses in a new effort to boost anemic economic growth.

The Kospi in Seoul shed 1.2 percent to 2,580.95 and Sydney's S&P-ASX 200 declined 1.4 percent to 7,025.20. New Zealand and Southeast Asian markets also retreated.

On Wall Street, the S&P 500 sank to 3,991.24. That leaves Wall Street's benchmark down 16.8 percent from its January 3 record.

The Dow Jones Industrial Average fell 2 percent to 32,245.70. The Nasdaq composite slid 4.3 percent to 11,623.25 as tech stocks to the brunt of the selling.

Energy stocks also fell. Marathon Oil and APA Corp. each sank more than 14 percent.

Stocks have declined as the Fed turns away from a strategy of pumping money into the financial system, which boosted prices.

The US central bank has raised its key rate from close to zero, where it sat for much of the coronavirus pandemic. Last week, it indicated it will double the size of future increases from its usual margin.

China on Monday reported export growth fell in April due to weak global demand while imports grew less than 1 percent over a year earlier.

In energy markets, benchmark US crude sank USD 2.02 to USD 101.07 per barrel in electronic trading on the New York Mercantile Exchange. The contract plunged from USD 6.68 to USD 103.09 on Monday. Brent crude, the price basis for international oil trading, lost USD 2.14 to USD 103.80 per barrel in London. It fell from USD 6.45 the previous session to USD 105.94.

The dollar declined to 130.22 yen from Monday's 130.32 yen. The euro rose to USD 1.0577 from USD 1.0566.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

Give Feedback