Asian stocks were largely down on Tuesday as surging COVID-19 cases in China hit sentiment of the traders along with geopolitical tensions between Russia-Ukraine and monetary tightening by U.S. Federal Reserves in nearly three years.
The CSI300, HSI and KOSPI is down by 1.20%, 2.50% and 0.47% respectively. The TOPIX is trading marginally in the positive by 0.88%.
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped by 2.42%.
The yield on the benchmark 10-year Treasury notes rose to 2.1419% compared with its U.S. close of 2.14% on Monday.
The two-year yield, which rises with traders’ expectations of higher Fed fund rates, touched 1.865%, up from 1.849%.
The fourth round of negotiations between Russia- Ukraine with no concrete progress, has also added nervousness the market.
“Right now everyone is looking at the Chinese cases and realising that has to have an effect on production,” said Hong Hao, BOCOM International’s head of research.
“China’s growth in the first quarter could be closer to zero than 5.5%. There’s a ripple effect. There’s Ukraine, the risk of U.S. sanctions on China and rising Chinese domestic COVID cases – it does not look good.”
Crude oil dipped below $100 with WTI trading at $98.34 per barrel while Brent is trading at $101 per barrel.
