Asian equities inched down sharply on Friday as major central banks hiked interest rates and depressed sentiment amid China’s COVID-19 lockdown.
Shares in Mainland China, Hong Kong, South Korea and Japan dipped sharply tracking losses of S&P500 and Nasdaq 100 overnight. MSCI Asian Index ex Japan dipped 0.12%.
Treasuries extended a slide that’s lifted the U.S. 10-year yield past 3%. A dollar gauge neared a two-year high. The yuan retreated.
Risk mode observed throughout markets after the Federal Reserves raised interest rates by the most since 2000 while pushing back against talk of super-sized increases.
“Valuations become even more sensitive, very sensitive, when rates are going up and that is what we are experiencing,” Kristina Hooper, chief global market strategist at Invesco, said on Bloomberg Television.
“It’s just getting exacerbated as we get into the thick of monetary-policy tightening in the U.S.”
Meanwhile, the Bank of England hiked interest rates to the highest since 2009 while warning of the possibility of double-digit inflation and a prolonged period of stagnation or even recession.
Commodity prices remained elevated with the WTI trading round $108 a barrel while the Brent trading around $111 a barrel.
