Asian stocks fall amid interest rate and earnings concerns | Health, Med. & Fitness

By YURI KAGEYAMA – AP Business Writer

TOKYO (AP) — Asian stocks fell Monday after U.S. stocks closed lower last week as global markets’ expectations of higher interest rates continued to set the tone.

Japan’s benchmark Nikkei 225 index lost 1.9% in morning trading at 26,583.70. South Korea’s Kospi fell 1.6% to 2,661.94. Hong Kong’s Hang Seng fell 2.8% to 20,064.32, while the Shanghai Composite lost 2.4% to 3,012.93. Trading was closed in Australia for Anzac Day, a national holiday.

News that Emmanuel Macron won the second round of the French presidential election over the weekend, securing a second term as widely expected, assured markets that France will not abruptly change course amid the war in Ukraine.

But a significant show by contender Marine Le Pen, a populist and nationalist, served as a reminder of how fragile that situation could be, analysts said. Le Pen vowed to dilute France’s ties with the EU, NATO and Germany, and spoke out against EU sanctions on Russian energy supplies.

The rise in COVID-19 cases in China is raising concerns about more pandemic lockdowns that would hamper economic recovery in the region. Other nations are also dealing with economic problems related to COVID-19, such as the absence of tourism revenue in Japan, where cases continue to rise and fall as it gradually opens its borders, but only to business travelers.

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Investors are also keeping an eye on earnings reports from companies, including large Japanese firms, due in the coming weeks. Several reports from US companies, which have already been released, have been disappointing, contributing to the slump that ended last week on Wall Street.

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What the US Federal Reserve might do is a priority for investors. The Chairman of the Federal Reserve has indicated the central bank may raise short-term interest rates to double the usual rate at upcoming meetings, starting in two weeks. The Fed has already raised its key overnight rate once, the first such increase since 2018.

The S&P 500 fell 2.8% on Friday to 4,271.78, marking its third losing week in a row. The Dow fell 2.8% to 33,811.40, its biggest drop in 18 months. The Nasdaq lost 2.6%, closing at 12,839.29. The Dow Jones and the Nasdaq also posted losses for the week.

Shares of smaller companies also fell sharply. The Russell 2000 fell 2.6% to 1,940.66.

“After the strong sell-off on Wall Street that ended last week, the overall risk appetite in the region may also come under pressure,” said Yeap Jun Rong, market strategist at IG in Singapore.

Markets around the world are feeling similar pressure on rates and inflation, particularly in Europe, as the war in Ukraine drives up oil, gas and food costs.

In energy trading, benchmark US crude lost $2.91 to $99.16 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, fell $2.93 to $103.72 a barrel.

In currency trading, the US dollar fell to 128.51 Japanese yen from 128.59 yen. The euro cost $1.0789, down from $1.0803.

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