TOKYO (AP) – Shares fell in most Asian markets on Monday as rising interest rates and a slowdown in China’s economy have affected investor sentiment.
Oil prices were higher, and US futures fell after a sharp decline on Wall Street last week.
Indicators have declined across the region. Jakarta’s figure fell by 4%.
Market players expected Chinese trading data for April to show how severe the restrictions on curbing the spread of COVID-19 infections have hurt the economy.
“The global investment community is slowly waking up to an idea we’ve been promoting for a long time: that there’s a hangover after recovery, euphoria combined with related inflation, and now the European war and a new impetus for inflation. as the world’s largest port closes, ”said Clifford Bennett, chief economist at ACY Securities.
Japanese benchmark Nikkei 225 lost 2.2% in morning trading to 26,410.30. South Korean Kospi fell 0.9% to 2,621.24. The Australian S & P / ASX 200 fell 1.3% to 7,110.50. Shanghai Composite remained virtually unchanged, down less than 0.1% to 3001.62. Markets in Hong Kong have been closed due to the national holiday.
Investors are watching the outcome of the presidential election in the Philippines, although it remains unclear how economic policy may change. The son of long-ousted Philippine dictator Ferdinand Marcos is the main contender for Monday’s vote, according to most polls.
Aside from concerns about inflation and coronavirus restrictions, the war in Ukraine remains a major cause of uncertainty. Ukrainian officials say more than 60 people have died after a Russian bomb destroyed a school used as a shelter. Moscow forces attacked defenders at the Mariupol steel plant in a clear race to seize the city on the eve of Victory Day in Russia on Monday.
“Today’s Russia Victory Day will also bring back geopolitical risks. President Putin is likely to reiterate his justification for the war in Ukraine, but markets may be waiting for further efforts to step up military operations to guarantee war, ”said Yep Jun Rong, IG’s market strategist in Singapore.
Shares closed lower on Wall Street on Friday with the fifth consecutive weekly market decline. There are growing fears that despite strong U.S. employment trends, the Federal Reserve’s efforts to curb inflation by raising interest rates could lead the U.S. economy into recession.
An increase in the Fed’s key short-term rate on Wednesday raised it by 0.5 percentage point to a range of 0.75% to 1%, the highest level since the pandemic two years ago.
The S&P 500 fell 0.6% to 4,123.34. The Dow was down 0.3% to 32,899.37. Nasdaq dropped 1.4% to 12,144.66. Smaller companies have fallen more than the broader market. Russel 2000 fell 1.7% to 1,839.56.
The Fed hopes to raise rates and slow the economy enough to suppress the highest inflation in four decades, but it risks stifling growth if it goes too far or too fast. Fed Chairman Jerome Powell reassured investors, saying the central bank had not “actively considered” an even bigger jump of 0.75 percentage points at its next meeting.
In electronic trading on the New York Mercantile Exchange, U.S. benchmark oil rose 43 cents to $ 110.20 a barrel. Brent crude, which is the basis of oil pricing for international trade, rose 77 cents to $ 113.16 a barrel.
In foreign exchange trading, the US dollar rose to 130.98 Japanese yen from 130.55 yen. The euro was worth $ 1.0510, compared to $ 1.0545.
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