Asian markets are broadly lower after Wall Street slumped on a heavy selling of technology and internet stocks.
SINGAPORE — Asian markets were broadly lower on Thursday after Wall Street slumped on a heavy selling of technology and internet stocks.
Japan’s benchmark fell by an unusually wide margin of 3.9 percent and China’s main index lost 4.3 percent. Markets in Hong Kong, South Korea, Australia and Southeast Asia recorded similar declines.
Investors are wary of possible further U.S. interest rate hikes. That will raise the cost of corporate borrowing and could drag on economic growth.
The U.S. Federal Reserve recently raised short-term interest rates for the third time this year, with one more expected before the year ends. Strong economic data and a positive outlook from Fed officials have led to a sell-off in U.S. Treasury bonds, particularly longer-term ones, sparking concerns about even higher interest rates.
On Wednesday, President Donald Trump said the Fed “is making a mistake” with its campaign of rate increases. “I think the Fed has gone crazy,” he charged.
Stephen Innes of OANDA said that Trump’s comments have put pressure on the dollar but “the severity of this equity rout could bring the hawkish Fed narrative into question.”
“If the Feds are crazy, this market reaction is bordering on insanity, as so many negative crosscurrents collide that is merely impossible to find a glint of optimism,” he added.
Sentiment also has been dampened by the spreading U.S.-Chinese tariff fight over Beijing’s technology policy. The International Monetary Fund cut its outlook for global growth this week, citing interest rates and trade tensions.
Tokyo’s Nikkei 225 gave up 3.9 percent to 22,591.10 and the Shanghai Composite lost 4.3 percent to 2,607.44. The Kospi in South Korea fell 3.6 percent to 2,148.97. Australia’s S&P/ASX 200 slipped 2.4 percent to 5,906.00. Stocks plunged in Taiwan and fell across Southeast Asia.
U.S. stocks slumped on Wednesday as concerns over rising interest rates and trade tensions caused a sell-off in technology and internet stocks. The Dow Jones Industrial Average suffered its worst loss in eight months, falling 3.1 percent to 25,598.74.