SINGAPORE — Shares in Asia-Pacific fell in Friday morning trading as investors watch the market’s reaction to late-night comments from Federal Reserve Chair Jerome Powell.
Japan’s Nikkei 225 led losses among the region’s major markets, falling 1.99%, while shares in conglomerate SoftBank Group fell more than 3%. The Topix Index lost 1.39%.
Hong Kong’s Hang Seng index pared some losses after earlier falling more than 2%. It was last traded 1.23% lower as shares in Chinese tech giants Tencent and Alibaba fell 2.93% and 3.7%, respectively.
Mainland China stocks were also down, with the Shanghai composite slipping 0.26% while the Shenzhen component fell 0.761%.
South Korea’s Kospi traded 1.07% lower. Australian stocks fell as the S&P/ASX 200 fell 1.74%.
MSCI’s broadest index of Asia Pacific equities outside of Japan traded 1.18% lower.
fed clock
Powell hinted at more aggressive rate hikes by the central bank to bring down inflation. He said the Fed was determined to raise rates “quickly” to tame inflation.
“I would say 50 basis points will be on the table for the May session,” Powell said. Following these comments, expectations for a 50 basis point move in May rose to 97.6% according to CME Group’s FedWatch tool.
“The bottom line is: rates are going to go up, the Fed wants to keep pushing them higher, and they’re going to keep going until something breaks. The question is: what will break and when?” said Michael Every, global strategist at Rabobank.
US Treasury yields also jumped on Powell’s comments. The yield on the benchmark 10-year Treasury, which started the year at about 1.5%, was last at 2.9425%.
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Wall Street stocks fell overnight in the US, with the S&P 500 slipping about 1.48% to 4,393.66. The Dow Jones Industrial Average lost 368.03 points, or 1.05%, to 34,792.76. The tech-heavy Nasdaq Composite lagged, falling 2.07% to 13,174.65.
Currencies and Oil
The US Dollar Index, which tracks the greenback against a basket of its peers, came in at 100.632 — once again above the 100 level it briefly fell below earlier this week.
The Japanese yen traded at 128.64 per dollar, still weaker from readings below 126 against the greenback last week. The Australian dollar was at $0.7358 after recently falling from above $0.744.
Oil prices were lower in the morning of the Asian session, with international benchmark Brent crude futures falling 0.88% to $107.38 a barrel. US crude oil futures lost 0.89% to $102.87 a barrel.
— CNBC’s Jeff Cox contributed to this report.