Advertisement

Asian markets rise after Wall St losses amid recession fears

10:19 AM Jan 20, 2023 | PTI |

Beijing: Asian stock markets rose Friday after Wall Street losses deepened as worries grow that the US economy is headed for recession.

Advertisement

Shanghai, Tokyo and Hong Kong advanced. Seoul declined. Oil prices gained.

Traders worry the Federal Reserve and other central banks might be willing to tip Western economies into recession as they try to extinguish inflation that is at multi-decade highs. A Fed board member, Lael Brainard, and President Christine Lagarde of the European Central Bank in separate appearances Thursday affirmed plans to keep interest rates elevated despite market hopes central banks might scale back plans due to indications economic activity might be cooling.

“That again implies more hikes to come and then a long hiatus, not the imminent reversal markets are pricing for,” Rabobank said in a report.

The Shanghai Composite Index rose 0.6 per cent to 3,260.04 and the Nikkei 225 in Tokyo gained less than 0.1 per cent to 26,411.94. The Hang Seng in Hong Kong gained 0.9 per cent to 21,844.98.

Advertisement

The Kospi in Seoul advanced 0.2 per cent to 2,384.47 and Sydney’s S&P-ASX 200 was less than 0.1 per cent higher at 7,439.50. New Zealand and Southeast Asian markets rose.

On Wall Street, the benchmark S&P 500 index lost 0.8 per cent to 3,898.85 in its third daily decline.

More than 75 per cent of the stocks in the S&P 500 closed lower. Technology companies, retailers and industrial stocks were among the biggest drags. Chipmaker Nvidia fell 3.5 per cent, Home Depot dropped 4 per cent and Deere & Co. fell 4.1 per cent.

The Dow Jones Industrial Average retreated 0.8 per cent to 33,044.56. The tech-heavy Nasdaq tumbled 1 per cent to 10,852.27.

Reports showed weakness in the US housing industry and manufacturing in the mid-Atlantic region, though they weren’t quite as bad as expected and the job market appears healthy. They followed worse readings than expected Wednesday on retail sales, a cornerstone of the economy, and industrial production.

The Fed and central banks in Europe and Asia raised interest rates aggressively last year to cool inflation that is multi-decade highs in some economies.

Forecasters expect a U.S. recession this year but say it likely will be brief.

Advertisement

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Next