Asian stocks follow Wall St down on rate hike, economy fears
A woman wearing a protective mask stands in front of an electronic stock board showing Japan's Nikkei 225 index Monday, May 9, 2022, in Tokyo. Shares fell in most Asian markets on Monday as interest rate hikes and a slowing Chinese economy weighed on investor sentiment. (AP Photo/Eugene Hoshiko)[ASSOCIATED PRESS/Eugene Hoshiko]
BEIJING (AP) — Asian stocks followed Wall Street lower Tuesday as fears increased that U.S. 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 $1 but stayed above $100 per barrel.
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 U.S. 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.
A woman wearing a protective mask walks in front of an electronic stock board showing Japan's Nikkei 225 index and Japanese yen and U.S. dollar exchange rate at a securities firm Monday, May 9, 2022, in Tokyo. Shares fell in most Asian markets on Monday as interest rate hikes and a slowing Chinese economy weighed on investor sentiment. (AP Photo/Eugene Hoshiko)
Photo: ASSOCIATED PRESS/Eugene Hoshiko
People wearing protective masks stand in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Monday, May 9, 2022, in Tokyo. Shares fell in most Asian markets on Monday as interest rate hikes and a slowing Chinese economy weighed on investor sentiment. (AP Photo/Eugene Hoshiko)
Photo: ASSOCIATED PRESS/Eugene Hoshiko
A man wearing a protective mask walks in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Monday, May 9, 2022, in Tokyo. Shares fell in most Asian markets on Monday as interest rate hikes and a slowing Chinese economy weighed on investor sentiment. (AP Photo/Eugene Hoshiko)
Photo: ASSOCIATED PRESS/Eugene Hoshiko
Women wearing protective masks walk in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm Monday, May 9, 2022, in Tokyo. Shares fell in most Asian markets on Monday as interest rate hikes and a slowing Chinese economy weighed on investor sentiment. (AP Photo/Eugene Hoshiko)
Photo: ASSOCIATED PRESS/Eugene Hoshiko
Traders work on the floor at the New York Stock Exchange Friday, May 6, 2022 in New York. Stocks are swinging sharply on Friday. The S&P 500 was 0.5% lower in afternoon trading but only after careening from a steep morning loss to a brief, small gain. Wall Street is struggling with how to interpret a strong U.S. jobs report amid worries the Federal Reserve may cause a recession in its drive to halt inflation. (NYSE via AP)
Photo: ASSOCIATED PRESS/Courtney Crow
FILE - The New York Stock Exchange operates during normal business hours in the Financial District, Wednesday, Oct. 13, 2021, in the Manhattan borough of New York. Stocks are opening lower on Wall Street, following a highly turbulent week for markets with more losses as traders see little relief in sight for their current list of worries: coronavirus lockdowns in China, looming interest rates hikes and inflationary pressures exacerbated by Russia's war in Ukraine. The S&P 500 gave up 1.4% in the early going Monday, May 9, 2022. (AP Photo/John Minchillo, File)
Photo: ASSOCIATED PRESS/John Minchillo
A man wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 10, 2022. Asian stocks followed Wall Street lower Tuesday as fears increased that U.S. rate hikes to fight inflation might stall economic growth. (AP Photo/Kin Cheung)
Photo: ASSOCIATED PRESS/Kin Cheung
A man wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 10, 2022. Asian stocks followed Wall Street lower Tuesday as fears increased that U.S. rate hikes to fight inflation might stall economic growth. (AP Photo/Kin Cheung)
Photo: ASSOCIATED PRESS/Kin Cheung
A woman wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 10, 2022. Asian stocks followed Wall Street lower Tuesday as fears increased that U.S. rate hikes to fight inflation might stall economic growth. (AP Photo/Kin Cheung)
Photo: ASSOCIATED PRESS/Kin Cheung
A woman wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 10, 2022. Asian stocks followed Wall Street lower Tuesday as fears increased that U.S. rate hikes to fight inflation might stall economic growth. (AP Photo/Kin Cheung)
Photo: ASSOCIATED PRESS/Kin Cheung
The Nikkei 225 in Tokyo lost 0.9% to 26,074.53 and Hong Kong’s Hang Seng dropped 2.6% to 19,478.31.
The Shanghai Composite Index gained 0.4% 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% to 2,580.95 and Sydney’s S&P-ASX 200 declined 1.4% 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% from its Jan. 3 record.
The Dow Jones Industrial Average fell 2% to 32,245.70. The Nasdaq composite slid 4.3% 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%.
Stocks have declined as the Fed turns away from a strategy of pumping money into the financial system, which boosted prices.
The U.S. 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 U.S. crude 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, 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 declined to 130.22 yen from Monday’s 130.32 yen. The euro rose to $1.0577 from $1.0566.
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