SINGAPORE – Shares in Asia-Pacific were down after Tuesday morning’s trading S&P 500 falls overnight and closes in bear territory,
of australia S&P/ASX 200Which returned to trading Tuesday after the holiday yesterday, falling nearly 5% and leading to losses in key markets in the region.
Nikkei 225 Japan fell 2% while the Topix index lost 1.7%. of south korea kospi fell 1.26%.
MSCI’s broadest index of Asia-Pacific shares outside Japan traded about 1% lower.
Risk assets dwindle with bearish risk as yields rise and Fed’s expectations to Volcker
Tapas Strickland
Director of Economics, National Australia Bank
The S&P 500 fell nearly 4% overnight to 3,749.63, closing in bear market territory, or more than 20% below its January peak.
Other major index states also saw major declines. The Dow Jones Industrial Average fell 876.05 points, or 2.79%, to end at 30,516.74. The tech-heavy Nasdaq Composite fell 4.68% to around 10,809.23.
The losses on Wall Street came as investors expected a potentially faster rate hike by the US Federal Reserve: Consumer inflation report hotter than expected on Friday,
Fed policy makers are now Considering the idea of a 75-basis-point rate hike later this week, according to CNBC’s Steve Lysman. This is larger than the 50-basis-point increase that many traders expected. wall street journal Tell the story first.
“Risk assets have decreased with recession risk, increasing the Fed’s Volcker yields and expectations,” Tapas Strickland, director of economics at National Australia Bank, said in a note on Tuesday.
In the early 1980s, former Fed chief Paul Volcker Helped Overcome Inflation By Raising Inflation The benchmark interest rate neared 20% and sent the economy into recession.
“If the Fed raises by 75 bps it will be a true Volker moment and underscore the front loading, conversely a 50 bp hike will strengthen the prospect of a 50 bp hike at every meeting for the rest of the year,” Strickland said.
The yield on the benchmark 10-year Treasury note recently clocked its yield Biggest move since March 2020, last stood at 3.3713%. The 2 year rate also saw a big jump and is currently trading at 3.3898%. Yields move inversely to prices, and one basis point equals 0.01%.
The 2-year rate now sits higher than the 10-year Treasury yield, which represents an inverse — a measure closely watched by traders and often seen as a potential indicator of bearishness.
currencies
US Dollar IndexThe greenback, who tracks against a basket of his peers, was at 105.128 – continuing a general upward trek after last week’s climb from levels below 102.6.
Japanese yen Traded at 134.12 per dollar, stronger than the levels above 135 against the greenback yesterday. Australian Dollar After yesterday’s decline above $0.70 was at $0.6946.