Asian stocks are lower after Wall Street retreat that left the Nasdaq Composite down 2.5%
BANGKOK – Asian shares fell on Friday after a return on Wall Street that left the Nasdaq Composite down 2.5%.
Tokyo fell nearly 2% but recovered some ground later in the session. Hong Kong, Shanghai and Seoul were also lower.
China reported that its global trade surplus grew nearly 30% to $676.4 billion in 2021. The trade surplus in December rose 20.8% from a year earlier to a monthly record of $94.4 billion, customs data showed on Friday.
Exports rose to $3.3 trillion in 2021 despite a shortage of processor chips for smartphones and other products, as global demand resumed from the pandemic. The rationing of electricity in some areas also caused problems for the manufacturers.
South Korea’s central bank has raised its key interest rate from 1% to 1.25% to combat inflation. But while it is dialing back monetary stimulus, after raising the benchmark rate twice so far, the government on Friday won 14 trillion ($11 billion) in additional spending, mainly to small businesses in the wake of the coronavirus outbreak. To help you recover from the effects of.
Inflation rose to 3.7% in December, and the latest rate hike “gives a strong indication that the bank is prioritizing inflation and reducing fiscal imbalances,” Alex Holmes of Capital Economics said in a report. Imminent,” he said.
South Korea’s Kospi fell 1.4% to end at 2,920.75.
The Shanghai Composite Index fell 0.6% to 3,534.17 and the Hang Seng in Hong Kong fell 1% to 24,179.16. Tokyo’s Nikkei 225 fell 1.5% to 28,078.98.
In Sydney, the S&P/ASX 200 was down 0.9% at 7,405.70.
India’s Sensex was down 0.4%.
Technology companies led the sell-off on Wall Street on Thursday that dragged major indices into the red for the week.
The S&P 500 fell 1.4% to 4,659.03. The tech-heavy Nasdaq fell 2.5% to settle at 14,806.81. The Dow Jones Industrial Average fell 0.5% to 36,113.62.
Shares of smaller companies also fell. The Russell 2000 closed 16.62 points, or 0.8%, down at 2,159.44.
The sell-off came as investors speculated on the company’s earnings report and new data pointing to rising wholesale prices. Inflation has been a major focus for investors as they try to figure out how rising prices will affect businesses, consumers, and the Federal Reserve’s policy on interest rates in 2022.
“Investors continue to worry that the worst in terms of inflation is yet to be seen,” said Sam Stovall, chief investment strategist at CFRA.
The yield on the 10-year Treasury fell to 1.72% from 1.73% since late Wednesday.
The Labor Department reported Thursday that its producer price index, which measures prices at the wholesale level, rose by a record 9.7% for all of 2021. The increase set an annual record and provided further evidence that inflation still exists at all levels. American economy. The report follows the release of consumer price data for December on Wednesday, which showed inflation rose last month at the fastest pace in nearly 40 years.
He added that many big tech companies with solid revenues and profits, such as Apple and Microsoft, will suffer less losses than their counterparts who have far less revenue but rosy estimates.
Still, even those big tech names lost ground on Thursday. Apple fell 1.9% and Microsoft 4.2%.
Health care stocks, communications services firms and a mix of companies that rely on direct consumer spending were in decline. Pfizer fell 2%, Facebook parent meta platform fell 2% and Amazon fell 2.4%.
Industrial companies were also among the beneficiaries. Delta Air Lines grew 2.1% after reporting surprisingly good fourth-quarter financial results. Other airlines also got a boost. American Airlines rose 4.5% and United Airlines rose 3.5%.
US benchmark crude oil fell 33 cents to $81.79 a barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the base for international oil pricing, fell 15 cents to $84.32 a barrel.
Dollar weakened from 114.18 yen to 113.66 Japanese yen. The euro rose from $1.1457 to $1.1476.