- COP29 fight looms over climate funds for developing world
- Shanghai stocks soar to extend stimulus rally amid Asia-wide drop
- Australia moves to expand Antarctic marine park
- Tragedy of Madrid street sweeper highlights how heatwaves kill
- Survivors wait for aid as Trump's lies help cloud Helene response
- Fleeing Israeli bombs, Lebanon's displaced met with suspicion
- Jila Mossaed, from refugee poet to Swedish Academy
- Will Tesla's robotaxi reveal live up to hype?
- Drugs, people smuggling at heart of Mexico's raging violence
- 'Invisibility' and quantum computing tipped for physics Nobel
- Musk says he is 'all in' on Trump in US election
- Category 5 Hurricane Milton roars towards storm-battered Florida
- Carpenter bomb stuns Guardians as Tigers level series
- Harris, Trump and Biden mark Oct. 7 attacks as US election looms
- Oil prices extend gains on Mideast tensions, Wall Street falls
- US judge orders Google to open Android to rival app stores
- On attacks anniversary, Israel fights 'sacred' multi-front war
- Nobel scientist uncovered tiny genetic switches with big potential
- Grammy-winning Cissy Houston, mother of Whitney, dies at 91
- UN biodiversity summit in Colombia aims to turn words into action
- Georgia Supreme Court reinstates six-week abortion ban
- 'Dark day': Victims mourned around the globe on Oct. 7 anniversary
- On attacks anniversary, Israel fights multi-front war
- Mexican mayor murdered days after taking office
- Intensifying to Category 5, Hurricane Milton targets Florida
- Mission to probe smashed asteroid launches despite hurricane
- Biden, Harris mark Oct. 7 with call for Mideast peace
- Dupont set for Toulouse return after post-Olympic holiday
- French rugby bosses tighten discipline after nightmare Argentina tour
- Oil prices extend gains on Mideast tensions, Wall Street slips
- Visitors to get rare view of Rome's Trevi Fountain
- Europe's asteroid mission Hera launches despite hurricane
- Man City and Premier League both claim victory in legal case
- Deschamps delight as 'light back on' for Pogba after doping ban
- Biden, Harris urge Mideast peace on Oct. 7 anniversary
- Neeskens, tough midfielder in Cruyff's Ajax and Dutch teams
- UN warns world's water cycle becoming ever more erratic
- Oil prices extend gains on Mideast tensions, Wall Street retreats
- Ex-Dutch football star Johan Neeskens dies
- Man Utd battling to improve fortunes, says Evans
- What is microRNA? Nobel-winning discovery explained
- Masood, Abdullah centuries lift Pakistan to 328-4 in first England Test
- Hurricane Milton strengthens fast, threatens Mexico, Florida
- Tunisia's President Saied set for landslide election win
- Barca hoping to return to Camp Nou 'by end of year'
- Trump to open second golf course at Scotland resort in summer 2025
- Super-sub Jhon Duran rewarded with new Aston Villa deal
- US duo win Nobel for gene regulation breakthrough
- Masood hits first ton for four years to power Pakistan to 233-1
- Fritz wins delayed match to reach Shanghai Masters third round
RBGPF | -1.97% | 58.94 | $ | |
BCC | 1.68% | 141.27 | $ | |
JRI | -0.76% | 13.18 | $ | |
CMSD | -0.09% | 24.79 | $ | |
CMSC | -0.53% | 24.57 | $ | |
GSK | -0.49% | 38.63 | $ | |
AZN | -0.78% | 76.87 | $ | |
SCS | -0.15% | 12.95 | $ | |
RELX | -0.54% | 46.04 | $ | |
RIO | -0.11% | 69.62 | $ | |
NGG | -1.56% | 65.48 | $ | |
RYCEF | -1.45% | 6.88 | $ | |
BCE | -0.54% | 33.53 | $ | |
BTI | -0.26% | 35.2 | $ | |
VOD | 0.31% | 9.69 | $ | |
BP | 0.78% | 33.14 | $ |
Asian, European markets track Wall St retreat on hawkish Fed bets
Equities sank Wednesday after Wall Street tumbled on bets the Federal Reserve will act more aggressively to bring inflation under control, while oil recovered some losses caused by the European Union's decision not to ban Russian crude.
While the Ukraine war continues to cast a shadow across trading floors, Fed monetary policy is at the top of the agenda this week as investors fret over how quickly officials will withdraw their vast pandemic-era financial support.
After last month's 0.25-percentage-point hike in interest rates, the focus is now on its plans for May's meeting, with expectations growing that it will announce a 0.50-point lift followed by several more before the end of the year.
Fed governor Lael Brainard, who is considered a dove, on Tuesday spooked traders by saying bringing inflation down from 40-year highs was of "paramount importance" and that the bank was "prepared to take stronger action" if warranted.
Brainard, who is awaiting congressional confirmation for the position of Fed vice chair, also said bank policymakers were ready to start reducing its vast bond holdings, which have helped keep borrowing costs down.
"The market might have been looking for... Brainard to at least give more balanced remarks -- instead, they were at the hawkish end of the spectrum from someone like Brainard," said Stephen Innes of SPI Asset Management.
"She was not overly hawkish, but neither did she offer anything for the doves to cling to."
Michael Hewson at CMC Markets added that Brainard's comments, and those from Mary Daly of the San Francisco Fed, "put into sharp relief the concerns investors have, that in looking to rein back inflation, the Fed might overplay its hand and tighten too aggressively and tip the economy into recession".
Minutes from the Fed's March meeting will be released later in the day and will be pored over for insights into officials' thinking, in light of the war and recent data suggesting the world's top economy remains resilient for now.
All three main indexes on Wall Street ended in the red, with the Nasdaq off more than two percent owing to tech firms being more susceptible to higher rates.
And the selling seeped through to Asia.
Hong Kong and mainland Chinese investors returned from a break to data indicating a sharp drop in China's services sector caused by the imposition of lockdowns around the country including Shanghai, its biggest city.
Hong Kong dropped more than one percent but Shanghai recovered from early selling to end marginally higher.
Tokyo, Sydney, Seoul, Singapore, Mumbai, Manila, Jakarta, Bangkok and Wellington also retreated.
London, Paris and Frankfurt opened lower.
"Liquidity remains poor, and no one seems willing to take the other side as air pockets are becoming easier to find these days," Innes added.
The European Union's decision not to include Russian oil in a fresh round of sanctions saw both main contracts drop Tuesday and extend losses in early Asian business.
The reliance of the bloc -- and particularly Germany -- on crude from Russia has kept it from following the United States and Britain in imposing an embargo, though it signalled it wants to hit the country's coal and shipping.
However, European Council chief Charles Michel told the European Parliament on Wednesday that it must impose oil and gas sanctions "sooner or later".
Adding to downward pressure on crude is the stronger dollar, which jumped in reaction to Brainard's comments. Oil is priced in dollars, making it more expensive for clients using other currencies.
A coordinated move by Washington, Brussels and the G7 could also ban "all" new investments in Russia on Wednesday, while the US Treasury said Washington has barred Moscow from making debt payments using funds held at American banks.
Meanwhile, the Asian Development Bank lowered its 2022 growth forecast for developing Asia owing to "increasing" price pressures caused by Russia's invasion of Ukraine, offsetting the recovery from Covid-19.
"The Ukraine crisis is nowhere near to being resolved," Amy Wu Silverman, at RBC Capital Markets LLC, told Bloomberg Television. "And then we’re heading into earnings season. Volatility levels are probably too low and will start to pick up."
- Key figures around 0720 GMT -
Tokyo - Nikkei 225: DOWN 1.6 percent at 27,350.30 (close)
Hong Kong - Hang Seng Index: DOWN 1.3 percent at 22,219.85
Shanghai - Composite: FLAT at 3,283.43 (close)
London - FTSE 100: DOWN 0.2 percent at 7,599.04
Brent North Sea crude: UP 0.5 percent at $107.19 per barrel
West Texas Intermediate: UP 0.3 percent at $102.21 per barrel
Dollar/yen: UP at 123.93 yen from 123.60 yen late Tuesday
Euro/dollar: DOWN at $1.0892 from $1.0903
Pound/dollar: DOWN at $1.3067 from $1.3071
Euro/pound: DOWN at 83.35 pence from 83.38 pence
New York - Dow: DOWN 0.8 percent at 34,641.18 (close)
J.Williams--AMWN