Asian stocks follow Wall St lower after Fed rates signal
BEIJING (AP) — Asian stock markets followed Wall Street lower on Thursday after investors saw minutes from a Federal Reserve meeting as a sign the U.S. central bank might hike interest rates faster to cool inflation.
Shanghai, Tokyo, Hong Kong and Sydney retreated. Oil prices fell.
On Wednesday, Wall Street's benchmark S&P 500 index fell by its biggest daily margin in four months.
Notes released Thursday from the Fed meeting last month showed policymakers believe the U.S. job market is nearly healthy enough that ultra-low interest rates are no longer needed. Traders took that as a sign the Fed might be more aggressive about rolling back stimulus that is boosting stock prices.
The report “bludgeoned the markets" by upsetting expectations that earlier Fed plans were locked in, said Vishnu Varathan of Mizuho Bank in a report.
The Shanghai Composite Index slid 0.2% to 3,587.19 and the Nikkei 225 in Tokyo tumbled 2.7% to 28,553.02. The Hang Seng in Hong Kong lost 0.6% to 22,779.58.
The Kospi in Seoul retreated 0.8% to 2,928.78 and Sydney's S&P-ASX 200 sank 2.7% to 7,358.30.
India's Sensex opened down 1.4% at 59,355.63. New Zealand, Bangkok and Jakarta declined while Singapore gained.
The Fed indicated in mid-December that plans to wind down stimulus would be accelerated after U.S. consumer inflation hit a 39-year high.
That jolted investors who had been encouraged by stronger corporate profits and the spread of coronavirus vaccinations. Despite that, the S&P 500 ended 2021 with a 26.9% annual gain.
On Wall Street, the S&P 500 slid 1.9% on Wednesday to 4,700.58.
The Dow Jones Industrial Average fell 1.1% to 36,407.11, pulling back from the previous day's record. The Nasdaq composite tumbled 3.3% to 15,100.17 in its biggest one-day decline in 11 months.