Asian stock markets flooded with “red” in the morning session of May 13 after Wall Street stocks plunged by obsession with inflation.
|Hong Kong’s Hang Seng Index fell 1.4% in the morning session of May 13. Photo: AFP|
Mainland Chinese stock markets were “tinged with red” at the beginning of this morning session on May 13, with the Shanghai Composite Index down 0.8%, while the Shenzhen Component Index fell 0.98%.
On the Hong Kong market, the Hang Seng Index plunged 1.4%. Investors are looking forward to the results of the first quarter of 2021 and the financial year of the technology giant Alibaba that the group plans to announce at 7:30 tonight (Hong Kong / Singapore time). Shares of Alibaba listed in Hong Kong this morning fell 2%.
In Japan, the Nikkei 225 index fell the most among the major stock indexes of Asia with a decline of 2.14%, while the Topix index fell 0.85%. Shares of Softbank Group this morning slipped about 6% after the group decided not to extend the purchase plan, according to Reuters.
Red also covered the Australian market with the S & P / ASX 200 index slipping 0.4% as banking stocks fell into negative territory.
On the Korean market, the Kospi index recorded a decrease of 0.44%. Overall, the MSCI Asia-Pacific (excluding Japan) decreased by 0.8%. The stock markets of India, Malaysia, Singapore, and the Philippines were closed for the holiday today.
US stocks plunged last night after published data showed inflationary pressure was greater than forecast. The Dow Jones industrial average “evaporated” 681 points, or 1.99%, at the same time marking the worst session since January.
Meanwhile, the S&P 500 index also suffered the deepest drop for the day since February after falling 2.1%, while the tech-oriented Nasdaq Composite index lost 2.6%.
According to the US Department of Labor, the prices of goods and services in April rose at the fastest rate since 2008 with the consumer price index (CPI) soaring 4.2% year-on-year.
“The market response to the CPI is instantaneous … The fear of the stock market is that the US Federal Reserve (Fed) sharply raises interest rates if some opinion emerges that The Fed responded slowly as Mr. Summers (former US Treasury Secretary Lawrence Summers) pointed out, “said Tapas Strickland, director of economics and markets at the National Bank of Australia (NAB) this morning.
Experts Tapas Strickland said: “Moderate inflation and slow response by the Fed are beneficial developments over the past time, but if inflation increases and the Fed moves, it will negatively affect the stock price. promissory note”.
The Fed said earlier that the agency was accepting inflation higher than the 2% target and would consider an acceptable inflation threshold. But the current concern is that US inflation could become too hot and the Fed will be forced to raise interest rates, a negative move for the stock market.
On the money market, the greenback this morning slipped. The US dollar index against other major currencies fell to 90,648, from nearly 90.7 set previously. Japanese Yen also weakened and converted 109.50 JPY / USD, compared with about 108 JPY / USD recorded earlier. Australian dollar dropped to 1 AUD for 0.7741 USD, from 1 AUD / 0.78 USD previously.
Oil prices traded by Asian time this morning cooled down. US crude futures for delivery slid 0.7% to $ 65.62 / barrel while Brent for futures fell 0.69% to $ 68.84 / barrel.