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Asia, Europe Shares Fall Following Fed Chair Powell’s Testimony
Asia, Europe Shares Fall Following Fed Chair Powell’s Testimony

Asia, Europe Shares Fall Following Fed Chair Powell’s Testimony

Asia, Europe Shares Fall Following Fed Chair Powell’s Testimony

Asian and European markets declined following a congressional testimony from Federal Reserve Chairman Jerome Powell’s Tuesday.
The moves came after Powell’s positive assessment of the economy during his testimony. Powell also indicated that the central bank raising interest rates more than three times was a possibility as inflation moves “up to target”, CNBC reported.
Powell’s message wasn’t quite what Wall Street had expected: The US economy is doing well, maybe even better than he thought late last year.
“The gist is that even as Powell espoused that the Fed will continue to normalize policy at a gradual pace, markets suspect his confidence could rub off to four rate hikes for 2018, instead of the three penciled in,” Chang Wei Liang, a strategist at Mizuho Bank, said in a note.
On Wednesday, losses in Asia, which were initially slighter than declines seen stateside, steepened as the session progressed.
The Nikkei 225 declined 226.7 points, or 1.01%, paring some of its recent gains. The index slipped further into negative territory as the yen firmed during the session.
Manufacturers, technology, automakers and financials traded in negative territory. Among large caps, Honda Motor fell 1.71%, SoftBank Group dropped 1.93% and Fast Retailing lost 1.99%.
South Korea’s Kospi edged down by 0.86% as gains in tech heavyweight Samsung Electronics were offset by losses in automakers and manufacturing names. Samsung Electronics rose 0.42% amid a mixed tech sector.
In Australia, the S&P/ASX 200 shed 0.72%, with just two out of its 12 sub-indexes in positive territory. Gold producers and telecommunications stocks were among the worst performing sectors while the heavily weighted financial sector slipped 0.55%. Mining majors Rio Tinto and BHP traded lower by 0.99% and 1.86%, respectively.
Greater China markets extended losses after declining in the last session. Hong Kong’s Hang Seng Index fell 1.67%, driven lower by declines seen across sectors. Major financial stocks traded in negative territory, with heavyweights China Construction Bank and HSBC down 3.7% and 0.7%, respectively.
Tech giant Tencent, the most heavily weighted stock on the index, fell 2.96%, as other technology names similarly recorded declines.
MSCI’s broad index of shares in Asia Pacific excluding Japan was down 1.23%.
Meanwhile, major US stock indexes recorded declines of more than 1% across the board on Tuesday, with the Dow Jones industrial average falling 1.16%, or 299.24 points, to close at 25,410.03. US Treasury yields rose, with the yield on the benchmark 10-year treasury note standing at 2.9% during early Asian trade.
The Stoxx Europe 600 index ended down 0.2% at 382.36 as the consumer goods and telecom sectors led decliners. Germany’s DAX 30 index slipped 0.3% to 12,490.73, and France’s CAC 40 closed 0.01% lower at 5,343.93. The UK’s FTSE 100 edged down 0.1% to 7,282.45.

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