Asian stocks largely remained in the negative tracking Wall Street losses overnight on conners over inflation and virus curbs in China.
Shares in Mainland China pared loss while Hong Kong, South Korea, Thailand and Japan closed in loss over 1% each. The MSCI Broad Market Index ex Japan is trading higher by 0.56%.
U.S. futures S&P500 and Nasdaq counting loss over 1% each. Treasuries rose across the board, sending the 10- and 30-year Treasury yields down more than 10 basis points.
“The bounce on Tuesday was proven to have been ‘too optimistic’, thus the self-doubt stemming from the misjudgement only makes traders to click the sell button even harder,” said Hebe Chen, market analyst at IG as reported by Reuters.
“It must be said that the concern for inflation has never gone away since we stepped into 2022, however, while things haven’t reached the point of no return, they are seemingly heading in the direction of ‘out of control’. That, is probably the most worrying part for the market.
“There may be short-term bounces in equities like the last few days, but the big picture is that the era of low yields are over, and we are transitioning to a higher rates environment,” Hafeez told the Reuters Global Markets Forum.
The Biden administration is poised to fully block Russia’s ability to pay US bondholders after a deadline expires next week, a move that could bring Moscow closer to a default.
Meanwhile, Sri Lanka slipped to default rating after its policy makers voice debt restructuring in required.
Oil futures were dipped with WTI trading $107 a barrel and the Brent trading at $107 a barrel.