Asian Shares Decline On Rate Hike, Growth Worries

Asian stocks ended Thursday’s session mostly lower amid concerns that high inflation and rising interest rates may hamper economic growth and eat into corporate profits.

The dollar rose as far as 130.23 yen, its highest since May 11, supported by rising U.S. Treasury yields, while oil prices fell sharply ahead of an OPEC+ meeting.

The Financial Times reported that Saudi Arabia was prepared to pump more oil to compensate for any Russian output loss because of the Western sanctions imposed on the country.

China’s Composite Index rose 0.4 percent to 3,195.46 after China’s cabinet announced detailed measures to support infrastructure construction and counter economic slowdown.

Hong Kong’s Hang Seng Index dropped 1 percent to 21,082.13 amid signs of rising Covid-19 infections in the city.

Japanese shares edged lower from a six-week high as investors remained focused on inflation ahead of U.S. jobs data due on Friday.

The Nikkei 225 Index slipped 0.2 percent to 27,413.88 after having ended at the highest since April 21 the previous day. The broader Topix closed 0.6 percent lower at 1,926.39. M3, Sony and Fujitsu lost 3-4 percent.

Seoul stocks tumbled to snap a three-day winning streak amid renewed worries about the world economy possibly going into a recession.

A private sector survey showed earlier in the day that growth in South Korean factory activity slowed in May as output and new export orders decreased amid supply-chain disruptions.

The Kospi fell 1 percent to close at 2,658.99, dragged down by shipping and construction firms. CJ Logistics, Hyundai Engineering & Construction and HMM gave up 3-5 percent.

Australian stocks retreated following hawkish rhetoric from the Bank of Canada and JP Morgan’s warning on the economy.

The benchmark S&P/ASX200 Index slid 0.8 percent to 7,175.90, while the broader All Ordinaries ended 0.8 percent lower at 7,400.80.

Tech stocks led losses, with Block and Xero losing 5 percent and 3 percent, respectively. Woodside Energy surged 5.2 percent after JP Morgan on Wednesday night handled a $1.1 billion block trade in the company’s shares.

New Zealand shares ended slightly lower, with the benchmark NZX-50 Index closing down 0.2 percent at 11,349.54. Heavyweight Fisher & Paykel Healthcare care fell 1.1 percent, while Mainfreight rallied 2.6 percent.

U.S. stocks ended another volatile session lower overnight after JPMorgan Chase (JPM) CEO Jamie Dimon urged investors to brace for an economic hurricane.

The latest economic readings proved to be a mixed bag, with job openings declining from a record level, while growth in U.S. manufacturing activity unexpectedly accelerated in May.

The latest Beige Book report from the Fed suggested that growth was starting to slow in parts of the U.S. economy.

The Dow dropped half a percent, the tech-heavy Nasdaq Composite fell 0.7 percent and the S&P 500 shed 0.8 percent.

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