Wall Street retreat spills into Asia

Hawkish Fed minutes weighs on stock markets

Asian equity markets are lower today as it follows Wall Street south, digests the implications of a faster tightening Federal Reserve, and casts a nervous eye at China and its virus situation.

Overnight, the FOMC Minutes confirmed the hawkish comments of Lael Brainard the day before, causing more pain on Wall Street. The S&P 500 fell by 0.97%, the Nasdaq tumbled by 2.22%, while the Down Jones eased 0.42% lower. Index futures have continued falling in Asia, with Dow and S&P 500 futures down 0.25%, and Nasdaq futures down 0.15%.

In Asia, Tokyo’s Nikkei 225 has slumped by 1.75%, with South Korea’s Kospi retreating by 1.25%. Mainland China’s Shanghai Composite and CSI 300 have lost 0.50%, while rather surprisingly, Hong Kong’s Hang Seng is unchanged. Singapore is down 0.55%, Taipei is down 0.75%, Kuala Lumpur down 0.20%, and Jakarta 0.20% higher. Bangkok has lost 0.75% and Manila is 0.45% lower. Australian markets are also lower after the trade balance surprise, the ASX 200 and All Ordinaries losing 0.55%.

European equities had a torrid session overnight, caught in a vice grip of Russian sanction fallout, a faster tightening Federal Reserve and persistent nerves around the French presidential election. None of that has changed overnight and it is notable that Europe has not detailed its latest round of sanctions. The sombre mood in European equities will not lift today.

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Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was OANDA’s Senior Market Analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV and Channel News Asia as well as in leading print publications such as The New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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