Shares in Asia fell on Friday after Wall Street retreated on news that US inflation jumped 7.5 percent last month, raising expectations that the US Federal Reserve would need to move forcefully to cool the economy by increasing interest rates.
The S&P 500 sank 1.9 percent on the report that inflation was the hottest since 1982, while bond yields jumped as traders bet the Fed might have to apply the brakes to the economy with a bigger-than-usual interest rate hike next month.
Ten-year Treasury yields topped 2 percent for the first time since August 2019, Tradeweb said.
Asian economies also are feeling the heat of sharp price increases, with some such as New Zealand already moving to raise interest rates. Others are holding off: Central banks in Thailand, Indonesia and India this week opted to keep their benchmark rates unchanged.
Some countries in the region, such as China and Japan, are contending with higher prices and slow growth, and some are still entangled in COVID-19 outbreaks that are clouding the outlook for their recoveries from the pandemic.
The mild initial reactions to the price data outside the US suggest “markets may want to look towards economic data to guide expectations, considering that we have seen many central banks walked back on their inflation stance,” Yeap Jun Rong, market strategist at IG in Singapore, said in a commentary.
“We will be getting inflation readings out of China next week, which will be one to watch considering its impact on global prices,” he said.
In Taipei, the TAIEX closed down 27.11 points, or 0.15 percent, at 18,310.94. Turnover totaled NT$261.771 billion (US$9.4 billion).
For the week, the TAIEX rose 636.54 points, or 3.6 percent, after a decline of 3.08 percent last month.
Hong Kong’s Hang Seng Index on Friday slipped 0.07 percent to 24,906.66, up 1.36 percent on the week.
The Shanghai Composite Index gave up early gains, sinking 0.66 percent to 3,462.95, but posted a weekly increase of 3.02 percent.
In Sydney, the S&P/ASX 200 lost 0.98 percent to 7,217.3, rising 1.36 percent from a week earlier.
Seoul’s KOSPI in lost 0.87 percent to 2,747.71, declining 0.09 percent weekly.
India’s SENSEX dropped 1.31 percent to 58,152.92, losing 0.84 percent from a week earlier.
In Tokyo, markets were closed for the National Foundation Day holiday.
Additional reporting by staff writer, with CNA
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his