Asia Stocks Crashed by China Concerns and Inflation
Asian stocks weakened. Investors worried that rising interest rates and inflation would block the global economic point of view. The Chinese COVID-19 situation has forced the mood to suffer, especially for technology firms. MSCI’s broadest Asia-Pacific stock index outside Japan fell 0.3%. The main markets of the region are traded in red. Oil has risen, and gold has extended its recent profits. However, US and European markets seem to have avoided the gloomy mood in Asia. Euro Stoxx 50 futures rose 1.35%. DAX futures by 1.4%. FTSE futures added 0.83%. S&P 500 futures jumped 1.04%.
Australian stocks reversed early gains and fell 0.13%. The Nikkei Stock Index reversed the regional trend and was up 0.7%. Also, The negative tone was evident when the Hang Seng Index fell by 1.27%. The CSI300 index was down 0.7%. The Hang Seng Tech Index 2.2%. It decreased by 26.5% this year. Sales in Asia are primarily driven by negative global sentiment. China’s technology sector should remain volatile until more regulatory clarity; US markets will not stabilize.
In China, the daily figures for COVID-19 are closely monitored by investors. On Monday, Beijing announced 99 new infections for the previous day, the most effective daily rate in a one-month spread.
Stocks and Inflation
The decline in Chinese markets came after a surprisingly strong end to last week. The Hong Kong and Continental markets grew by almost 3%. According to the stock exchange, on Friday, there was a net inflow of $ 2.13 billion from foreign investors in shares on the Continent; This is the highest in 2022. Moreover, the dollar index in foreign currency, which controls Larnaca relative to the basket of currencies of other major trading partners, fell 0.35%, Up to a 102.63 mark.
Treasury 10-year benchmark income increased to 2.8207%. The two-year yield, which is rising in anticipation of traders expecting higher rates from the Fed Funds, stood at 2.6266%. In fact, inflationary pressures remain for critical investors. Germany’s wholesale inflation figures, released on Friday, showed a higher-than-expected jump; This indicates that prices will remain elevated in the short term.
In Australia, the Labor Party won the general election over the weekend. This ended the almost 10-year rule of their conservative rivals. While Labor promises enhanced climate, housing, and social welfare reforms, Analysts do not believe that a change of government will significantly impact the economy.
The dollar fell 0.24% against the yen to 127.54. US crude rose 0.64% to $110.24 a barrel. Brent crude oil price increased by 0.9% – to $112.68 per barrel. Concerns about global economic growth have led to a resurgence of support for gold.
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