Mumbai, 4 Sep (Commoditiescontrol): Asian stocks and global futures experienced a sharp decline on Wednesday, with oil prices hitting multi-month lows, as a tech selloff on Wall Street and renewed concerns about U.S. economic growth pushed investors away from riskier assets.
Leading the downturn in Asia, Japan's Nikkei fell over 3%, while the MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1.6% in early trading. Historically, September has been challenging for stocks, but analysts pointed to a combination of factors contributing to this rout, including weak U.S. manufacturing data.
Wall Street had closed significantly lower on Tuesday, following a holiday on Monday. Tech giant Nvidia, a prominent player in the AI sector, saw its stock plummet nearly 10% as investor enthusiasm for artificial intelligence waned. U.S. stock futures extended their losses on Wednesday, with S&P 500 futures down 0.5% and Nasdaq futures falling 0.75%. In Europe, EUROSTOXX 50 futures slid more than 1%, while FTSE futures declined 0.73%.
Adding to the market's woes, recent data from China indicated a sluggish economic recovery, prompting calls for more stimulus from Beijing. Concerns about China's economic outlook, especially as the world's largest oil importer, further exacerbated the decline in oil prices due to expectations of weaker demand. Brent crude dropped to $73.32 a barrel, while U.S. crude fell to $69.83, both hitting their lowest levels since December. Both had fallen over 4% in the previous session.
In Hong Kong, stocks followed the regional trend, with the Hang Seng Index down 0.8%, and China's CSI300 blue-chip index losing 0.6%.
This week, a series of U.S. economic data releases are anticipated, including reports on job openings, jobless claims, and the closely watched nonfarm payrolls report due on Friday. Given the Federal Reserve's focus on the labor market, Friday's data could influence whether a potential interest rate cut this month will be modest or substantial.
Despite the turmoil in equities, currency and U.S. Treasury movements were less pronounced. Safe-haven currencies like the dollar and yen remained stable, with the yen steady at 145.43 per dollar. The dollar's rebound pushed the euro further from its recent 13-month high, with the euro last at $1.1054. Sterling also edged lower, falling 0.08% to $1.3105.
In bond markets, the benchmark 10-year U.S. Treasury yield eased slightly to 3.8348%, while the two-year yield stood at 3.8672%.
In commodities, spot gold saw a slight increase, rising 0.04% to $2,493.85 per ounce.
(By Commoditiescontrol Bureau: 09820130172)
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