Asian Markets Track WS Fall As Inflation Fears Rise
HONG KONG, China: Asian markets fell on Thursday, following losses on Wall Street fueled by growing inflation concerns and rumors that central banks will have to tighten monetary policies faster than expected.
As recent data and healthy corporate earnings indicate consumers continue to spend, traders increasingly fear more than a year of massive financial support – coupled with skyrocketing demand and grunts from the market. supply chain – can lose price control.
Wednesday’s figures showed UK inflation to be a ten-year high and an 18-year high in Canada – a week after US figures hit levels not seen since 1990.
The data – which reflects big gains in other countries – has intensified pressure on policymakers to act quickly, with some commentators warning of a possible recession if they don’t.
And all eyes are on the Federal Reserve – the central bank of the world’s largest economy – whose massive bond-buying program has been a key pillar in supporting the global recovery and stock market recovery.
Officials said they would start phasing out quantitative easing from this month and that they would not be in a rush to raise interest rates, saying the surge in inflation is only temporary.
But an extended period of soaring price reporting could force them to reassess their plans.
“With these most recent inflation readings, there are fears that the Fed is reducing the amount of purchases – accelerating that decrease,” Michael Arone, State Street Global Advisors, told Bloomberg Television.
“It would be a surprise to the markets and could induce some volatility.”
All three of Wall Street’s major indices finished in the red, and Asia followed suit.
Hong Kong, which fell on Wednesday after six straight days of gains, extended losses with tech companies among the biggest losers, while Tokyo, Shanghai, Singapore, Seoul, Wellington, Manila and Jakarta also suffered big sales.
Oil fell further, after experiencing a substantial drop the day before – amid concerns over demand – and after Joe Biden and his Chinese counterpart Xi Jinping discussed releasing some of their countries’ massive reserves to do so. in the face of soaring prices which is partly fueling inflation.
“Inflationary pressures are mounting everywhere and this worries some investors about the prospects for short-term growth, which could also translate into lower demand for crude,” said Edward Moya of Oanda.
Key figures around 02:30 GMT
Tokyo – Nikkei 225: DOWN 0.8% to 29,451.41 (pause)
Hong Kong – Hang Seng Index: DOWN 1.5% to 25,268.79
Shanghai – Composite: DOWN 0.6% to 3,516.20
Dollar / yen: LOWER to 113.95 yen from 114.09 yen at 9.45 p.m. GMT
Euro / dollar: at $ 1.1336 vs. $ 1.1326
Pound / dollar: up $ 1.3498 from $ 1.3493
Euro / pound: up to 83.98 pence against 83.91 pence
West Texas Intermediate: DOWN 0.8% to $ 77.73 per barrel
North Sea Brent: LOWER 0.4% to $ 80.00 per barrel
New York – Dow: DOWN 0.6% to 35,931.05 (close)
London – FTSE 100: DOWN 0.5% to 7,291.20 (close) AFP