Asian shares slide lower as weak China data adds to Fed rate worries

Morning Wednesday news: China stocks slide as nation`s manufacturing PMI hits 20-month low, Dollar holds steady and Gold hovers at two-week low. Powell’s comments on Tuesday fueled speculation that the FED Open Market Committee will push through rate rises this year

In details, the event is an actual reaction to yesterday`s comments made by Jay Powell which has fueled speculation that the Federal Open Market Committee will push through four rate rises this year, a prospect that sent the dollar and Treasury yields higher.

MSCI’s broadest index of Asia-Pacific shares outside Japan slipped more than 1%, its biggest daily percentage drop since February 9, 2018 when world financial markets were battered by concerns U.S. inflation is picking up.

China’s blue-chip CSI300 skidded 0.6% while Shanghai’s SSE (LON:SSE) Composite fell 0.8 percent and Hong Kong’s Hang Seng index declined more than 1%.

Growth in China’s services industry also slowed, suggesting the key sector was starting to display signs of fatigue.

In Japan, the world’s third-largest economy, industrial output in January took its biggest tumble since a devastating earthquake in March 2011, highlighting a weakening in demand and a build up of inventory. Japan’s Nikkei stumbled 1 percent on a slightly firmer yen.

Growth in India’s factory activity slowed too in February.

In commodities, oil prices extended declines on weak output data from China and Japan and as an industry data showed an increase in U.S. crude stockpiles.

Brent crude futures fell 40 cents to $66.23 a barrel, while U.S. crude was last down 33 cents at $62.68.
Spot gold eased to $1,317.61 an ounce, not far from Tuesday’s $1,313.26 which was the lowest in three weeks.

Spot gold eased to $1,317.61 an ounce, not far from Tuesday’s $1,313.26 which was the lowest in three weeks.

In currencies, the dollar held on to gains after rallying against most major currencies on Tuesday. It hovered near a recent 1-1/2 month top against the Australian dollar and held near a three-week high on the euro at $1.2221.

Sources: 

https://www.ft.com/content/a67bd056-1c24-11e8-956a-43db76e69936

https://www.reuters.com/article/us-global-markets/asian-shares-slide-as-weak-china-japan-manufacturing-data-add-to-fed-worries-idUSKCN1GC03R

https://www.cnbc.com/2018/02/27/asia-markets-powell-testimony-china-pmis-and-earnings-in-focus.html

http://uk.businessinsider.com/ap-asian-shares-fall-after-us-fed-chief-says-hes-optimistic-2018-2

https://www.nasdaq.com/article/asian-shares-follow-wall-street-lower-on-rate-hike-worries-20180228-00162

https://www.theglobeandmail.com/globe-investor/inside-the-market/market-updates/asian-shares-lurch-lower-as-fed-revives-fears-of-faster-rate-hikes/article38140735/?cmpid=rss

https://www.investing.com/news/stock-market-news/asian-shares-slide-as-weak-china-japan-manufacturing-data-add-to-fed-worries-1315766