(Bangkok) Global markets were in decline on Friday after tech companies lowered Wall Street benchmarks as investors contested the consequences of rising interest rates, surging COVID-19 cases and tensions between Beijing and Washington.
The Paris, London, Frankfurt and Tokyo stock exchanges were down, while that of Shanghai was up.
U.S. stocks fell in the wake of the Federal Reserve’s announcement of a rate hike coming next year to fight inflation, as brokers expected other central banks to take action as well. .
The Bank of Japan said on Friday it would cut some of its pandemic aid measures, reducing corporate bond purchases to pre-crisis levels after March. It also extended additional assistance for small business loans by six months. But his board meeting also kept ultra-relaxed monetary policy largely unchanged.
On Thursday, the Bank of England became the first central bank among major economies to raise interest rates to fight inflation. The European Central Bank is still planning to cut its stimulus measures in the event of a pandemic, but not abruptly.
The German DAX lost 0.8% to 15,513.92 points and the CAC 40 in Paris lost 0.7% to 6,953.55 points. Britain’s FTSE 100 lost less than 0.1% to 7,258.03 points.
In New York, before the markets opened, the extended S&P 500 index fell 0.2%,
The future of the S&P 500 was down 0.2%, while the Dow Jones Industrial Average remained almost unchanged.
On Asian stock exchanges, Tokyo’s Nikkei 225 index fell 1.8% to 28,545.68 points, while Seoul’s Kospi recovered from previous losses to gain 0.4%, to 3,017, 73 points. In Australia, the S & P / ASX 200 rose 0.1% to 7,304.00 points.
Hong Kong’s Hang Seng lost 1.2% to 23,192.63 points. The Shanghai SSE Composite Index fell 1.2% to 3632.36 points. Tensions between the United States and China were in the spotlight after the United States Congress approved legislation banning all imports from China’s Xinjiang region unless the companies could prove the products were manufactured without resorting to forced labor.
The S&P 500 index closed Thursday down 0.9% at 4668.67 points, erasing about half of its gains from the previous day. The NASDAQ Composite Index slipped 2.5% to 15,180.43 points, its biggest drop since September. The Dow Jones fell 0.1% to 35,897.64 points.
Several large tech companies have pulled the market down. Apple slipped 3.9% and Microsoft fell 2.9%.
The Russell 2000 Small Cap Index lost 2% to 2152.46 points. All major indices are on the verge of posting weekly losses.
The sell-off followed the moves the day before when the Fed announced plans to step up its reduction in monthly bond purchases, which helped keep interest rates low. The policy change paves the way for the Fed to start raising rates next year.
As interest rates are set to rise, investors are rethinking the high valuations they have assigned to tech giants.