Asian stocks open lower on inflation fears

© Reuters. A woman with an umbrella walks near an electrical board showing the Nikkei index at a Tokyo estate agent

From Echo Wang

MIAMI (Reuters) – Asian stocks opened lower on Wednesday on concerns about rising interest rates and high stock valuations, as well as a downtrend in US and European overnight trading.

The Dow and its premature losses made up after Federal Reserve Chairman Jerome Powell reaffirmed before the Senate Banking Committee that monetary policy would remain accommodative and not change without warning.

The tech heavy closed 0.5% as investors sold the big tech stocks that had driven the market rally since last March and turned into cyclicals, which helped raise the Dow and S&P 500.

But Powell’s statement did not completely dispel fears of rising inflation, as economies around the world are expected to recover more than expected this year, just weeks later when vaccines are rolled out around the world.

“Despite reassuring words from Mr Powell, the markets know that the Fed will have difficulty maintaining support for economies and markets when US inflation is above 2%,” said Michael McCarthy, chief markets strategist for CMC Markets in Sydney.

In early Asia trade, Australia was down 0.5%, South Korea was down 0.4% and 225 was down 0.9%. Hong Kong’s futures fell 0.37%.

US tech stocks fell as investors sold recent winners to convert them into assets that are expected to do well in an improving economy. Tech-heavy Nasdaq fell 0.5%, while tech stocks in Europe posted their worst two-day decline in four months at 3.7%.

Tesla (NASDAQ 🙂 Inc lost 2.2% to close in negative territory for the year and fell on tech sell-off and falling Bitcoin, which lost 12%. Tesla recently invested $ 1.5 billion in the cryptocurrency.

The S & P 500 rose by 15.66 points or 0.05% to 31,537.35, the S & P 500 by 4.87 points or 0.13% to 3,881.37.

added 0.1% to $ 1,806.25 an ounce.

That fell 0.037%, the euro rose 0.04% to $ 1.2154.

declined 3 cents on Tuesday to $ 61.67 a barrel, still close to its highest level since January 2020. 13 cents, or 0.2%, to $ 65.37 a barrel.

The 10-year US Treasury bill fell 1.4 basis points to 1.3551% in late US trade. It peaked at 1.389% early Tuesday before Powell testified.

The two-year US Treasury yield, which is typically in line with interest rate expectations, has barely changed at 0.1169%.

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