HONG KONG. On Monday, Asian stocks started the day down because people were still worried about the Fed’s tightening monetary policy and they were waiting to see how retailers did in their earnings reports that were due this week.
Wall Street stocks were mostly down on Friday. Both the S & P 500 and the Nasdaq fell when the yield on the 10-year US Treasury note rose above 2.7%. This is a sign that markets are getting ready for more tightening as the Federal Reserve fights inflation.
The losses continued in Tokyo, Hong Kong, and Shanghai, where the main indexes all fell more than 2% on Monday, as well as in New York.
Taipei and Seoul were also down, but Sydney and Jakarta made a little bit of money, too.
“Stocks are down at the start of the week because there is more and more evidence that the Federal Reserve will be more committed to its monetary policy inflation-fighting stance.”
If this week’s US March CPI data shows the peak of the inflation cycle, that could help the Federal Reserve better plan for a soft landing, no matter how narrow that path may seem. However, markets have been very strong as people talked about this on the surface.
It’s also important to look at the US and Chinese consumer prices in March this week, says Takashi Hiroki, the chief strategist at Monex. This will help us figure out what the Fed is doing with its money and what other central banks are doing as well.
The US central bank has recently taken a more hawkish tone as it moves quickly to tighten the economy. This has made traders nervous about the prospect of higher interest rates.
The euro gained up to 0.7 percent against the US dollar. This suggests that there was some relief from the French election, but that there was still a lot of uncertainty.
A victory for Marine Le Pen’s nationalist party would have worried investors because she has long been a supporter of Russia, which is a big problem for the country.
At the time, Macron was expected to beat Le Pen in the first round of voting on Sunday by a bigger-than-expected margin. The two candidates will now face off in a second-round later this month.
“Make no mistake: nothing has been decided,” Macron told his fans.
