Asian markets plunged yesterday following the worst session on Wall Street for months, after US President Donald Trump said the US Federal Reserve had “gone crazy” with plans for higher interest rates.
Shanghai plummeted nearly 5 percent, while Tokyo and Hong Kong both shed about 4 percent, as investors fretted about surging interest rates and the ongoing US-China trade war.
“All bets are off,” said Stephen Innes, head of trading for Asia-Pacific at Oanda Corp, adding that markets were “fraught with peril.”
“The US equity bloodbath is taking no prisoners in Asia as a sea of red greets investors at the open, as equity deleveraging and liquidation intensifies,” he said.
Taipei and the Shenzhen Composite Index — which tracks stocks on China’s second exchange — were both down about 6 percent.
Seoul fell more than 4 percent and Sydney and Singapore both dropped more than 2.5 percent.
The steep drop in Asia followed Wednesday’s plunge in New York, with the Dow Jones dropping nearly 830 points — the biggest fall since February — after Trump’s latest criticism of the Fed.
“I think the Fed is making a mistake,” Trump told reporters as he arrived for a campaign rally ahead of the US mid-term elections.
Trump has often touted Wall Street records as proof of the success of his economic program, but he downplayed the first major drop in months, saying it was a “correction that we’ve been waiting for.”
IMF managing director Christine Lagarde hit back yesterday, defending rate hikes that she said were justified by fundamentals.
“It is clearly a necessary development for those economies that are showing much improved growth, inflation that is picking up ... unemployment that is extremely low,” she told reporters in Nusa Dua, Indonesia, where the IMF is meeting. “It’s inevitable that central banks make the decisions that they make.”
Many of the biggest US names fell hard in Wednesday’s session, with Apple Inc, Boeing Co and Facebook Inc all slumping more than 4 percent and Amazon.com Inc, Nike Inc and Microsoft Corp shedding more than 5 percent.
Stocks have been under pressure since the yield on 10-year Treasury bonds jumped above 3 percent last week, a sudden move that raised fears of an overheating economy, speeding inflation and more aggressive Fed rate hikes.
“It’s just a beginning,” CEB International Investment Corp head of research Banny Lam (林樵基) told Bloomberg. “The US tech bubble may take a while to burst and we are facing many external uncertainties — trade wars, risks in emerging markets currencies and oil price.”
In Hong Kong — where the benchmark Hang Seng index is already down 15 percent this year — some of the biggest listed companies were also under pressure.
Chinese Internet group Tencent Holdings Ltd (騰訊) fell for the tenth consecutive day, dropping more than 7 percent through morning trade.
The turmoil on stock markets came after the IMF on Monday slashed its global growth forecast on worries over the US-China trade war and weakness in emerging markets.
In other markets, oil extended declines in Asian trade yesterday following a sharp build in US crude inventories and fears that Hurricane Michael would hurt demand.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained