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Asian stocks track sales on Wall Street Business

Shares in Asia fell on Thursday after the release of worse-than-expected inflation data sparked big sell-offs of technology stocks on Wall Street.

This is evidenced by a report by the US Department of Labor on Wednesday inflation slowed slightly in April, fell to 8.3% from 8.5% in March. Investors also found in the data some signals filled the glass, which suggest that inflation may peak and further weaken, but the figures were still higher than economists had predicted.

They also showed larger-than-expected price increases outside of food and gasoline, which economists call “core inflation,” which could be an indicator of future trends.

Markets are focused on inflation and where it is moving because it is forcing central banks to curtail support for economies that was deployed during the pandemic. The U.S. Federal Reserve, for example, has aggressively turned to raising interest rates after seeing high inflation last longer than expected.

By noon, Hong Kong’s Hang Seng was down 1.1% to 19,613.34. The Tokyo Nikkei 225 fell 0.8% to 26,905.91.

The Shanghai Composite Index fell 0.2% to 3,051.77. The Australian S&P / ASX 200 lost 0.9% to 7,002.50. South Korean Kospi fell 0.3% to 2,584.97.

On Wednesday, the early rally disappeared, leaving the S&P 500 down 1.6% to 3,935.18. This destroyed profits the day before when the benchmark index broke a three-day losing streak.

The Dow Jones industrial average fell 1% to 31,834.11. The Nasdaq fell 3.2% to 11,364.24 as technology stocks hampered the broad market. Each of the three major indexes goes at the rate of another weekly loss.

Shares of smaller companies also lost ground. Russell 2000 fell 2.5% to 1,718.14.

Economists said the inflation report would keep the Fed on track for a rapid and potentially sharp rise in interest rates in the coming months, although the data led to volatile trading on Wall Street.

Initially, the yield on Treasury bonds jumped, but in the morning reduced yields. Yields on 10-year Treasury bonds rose to 3.08% overnight, but fell to 2.90% early Thursday.

To hold back high inflation, the Fed has already lifted its key short-term interest rate from a record low near zero, where it has spent most of the pandemic. He also said he could continue to raise rates twice as much as usual in upcoming meetings.

Such steps are designed to slow the economy to help curb inflation, but the Fed risks causing a recession if it raises rates too high or too fast. Meanwhile, higher rates tend to lower stock prices and all types of investments. For example, more profitable, safer Treasury bonds are becoming more attractive to investors.

Conversely, higher rates diminish the attractiveness of stocks that dominated the ultra-low pandemic rates. This includes major technology companies, other high-rise stocks and even cryptocurrencies. For example, the Nasdaq loss, which was more than 27% this year, is much worse than the fall of about 17% for the S&P 500.

Coinbase, a trading platform for cryptocurrencies, fell 26.4% after it reported much weaker results over the last quarter than analysts had expected. Falling crypto prices delayed trading volumes during the quarter.

In addition to interest rates, in China, shutdowns aimed at terminating COVID increase the risk of supply chain disruptions for global companies and a slowdown in the world’s second largest economy.

The war in Ukrainemeanwhile, threatens to maintain high inflation due to disruptions in oil and natural gas markets.

In electronic trading on the New York Mercantile Exchange, US reference oil fell by $ 1.29 to $ 104.42 per barrel. On Wednesday, it increased by 6%.

Brent crude, the international pricing standard, fell from $ 1.31 to $ 106.20 a barrel. On the eve of it increased by 4.9%.

In currency trading, the dollar fell to 129.73 Japanese yen from 129.95 yen. The euro fell to $ 1.0515 from $ 1.0517.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or distributed without permission.

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