Asian markets follow Wall Street lower on economic fears

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

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The Nikkei 225 NIK,
in Tokyo lost 1.2% and Hong Kong’s Hang Seng HSI,
dropped 2.9%.

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The Shanghai Composite Index SCOMP,
gained 0.2% after the Chinese government announced rent cuts and other aid for small businesses in a new effort to boost anemic economic growth.

The Kospi 180721,
in Seoul shed 1.2% and Sydney’s S&P/ASX 200 XJO,
declined 1.4%. New Zealand NZ50GR,
and Southeast Asian markets STI,

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also retreated.

Wall Street’s benchmark S&P 500 index tumbled 3.2% 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.

On Wall Street, the S&P 500 SPX,
sank to 3,991.24. That leaves Wall Street’s benchmark down 16.8% from its Jan. 3 records.

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

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% over a year earlier.

In energy markets, benchmark US crude CLM22,
sank $2.02 to $101.07 per barrel in electronic trading on the New York Mercantile Exchange. The contract plunged $6.68 to $103.09 on Monday. Brent crude BRNN22,
the price basis for international oil trading, lost $2.14 to $103.80 per barrel in London. It fell $6.45 the previous session to $105.94.

The dollar USDJPY,
declined to 130.22 yen from Monday’s 130.32 yen.


Credit: /

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