Asian Stocks Tumble On Rate Hike Worries

asian down 10may22 lt

Asian stocks followed Wall Street lower on Tuesday amid worries that interest rate increases in the United States might stall global growth.

Regional markets ended well off their day's lows after the Chinese government announced rent cuts and other aid for small businesses in a new effort to boost economic growth.

Sliding U.S. bond yields undermined the dollar and helped gold regain some ground in Asian trade, while oil edged up slightly after tumbling around 6 percent in the U.S. trading session on demand worries.

China's Shanghai Composite Index rallied 1.1 percent to 3,035.84, and the yuan found some footing on Beijing's vows to support the struggling economy,

Hong Kong's Hang Seng Index tumbled 1.8 percent to 19,633.69 as trading resumed after a long holiday weekend.

Japan's Nikkei 225 Index dropped 0.6 percent to 26,167.10, with losses capped by encouraging household spending data and a rebound in U.S. stock futures following a sharp sell-off overnight. Tech stocks led loses, with Advantest and SoftBank Corp falling around 2 percent each.

NTT Data Corp slumped 7.2 percent to extend losses for a second day running on restructuring news. Similarly, Japan Steel Works lost 15.6 percent to extend losses from the previous session after revealing that a subsidiary had falsified product data going back to at least 1998.

Australian markets ended off their day's lows after new data showed retail sales volumes rose by 1.2 percent during the March quarter despite the spread of Omicron in many parts of the country.

The benchmark S&P/ASX 200 Index ended down 1 percent at 7,051.20 after having hit a three-month low earlier in the day.

New Zealand's benchmark NZX-50 Index fell 1.3 percent to 11,229.45 due to weak cues from international markets. Ryman Healthcare bucked the weak trend to close 6.7 percent higher at $8.87.

Seoul stocks extended losses for the sixth day and the won hit a 26-month low against the greenback on worries about aggressive monetary tightening in the United States and prolonged lockdown measures in China. The Kospi dropped 0.6 percent to 2,596.56.

U.S. stocks sank in a widespread sell-off overnight amid concerns over the Fed's ability to combat high inflation and avoid an outright recession.

The tech-heavy Nasdaq Composite plummeted 4.3 percent to reach its lowest closing level since November 2020, while the Dow lost 2 percent and the S&P 500 tumbled 3.2 percent to hit one-year closing lows.

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