Asia-Pacific markets fall after S&P 500 closes at new low for the year; China factory data ahead

Soegeefx AppsAsia MarketAsia-Pacific markets fall after S&P 500 closes at new low for the year; China factory data ahead

Abigail Ng

Shares in the Asia-Pacific traded lower on Friday, the last day of the third quarter, following another sell-off on Wall Street overnight. China’s factory activity data is due later today.

In Japan, the Nikkei 225 slipped 1%, and the Topix index fell 0.66%. Australia’s S&P/ASX 200 lost 0.11%.

The Kospi in South Korea declined 0.69% and the Kosdaq shed 1.39%. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.22%.

U.S. stocks tumbled in Thursday’s session, with the S&P 500 hitting a fresh low for the year and also reaching a new closing low. The index dropped 2.1% to end the session at 3,640.47. Meanwhile, the Dow Jones Industrial Average slumped 458.13 points, or 1.54%, to 29,225.61. The tech-heavy Nasdaq Composite lost 2.84% to 10,737.51.

“Geopolitical and inflation risks are not subsiding, and risk assets are taking the strain as expectations of lower growth and higher funding costs continue to permeate,” analysts at ANZ Research wrote in a Friday note.

.N225 Nikkei 225 Index *NIKKEI 26108.92 -313.13 -1.19
.HSI Hang Seng Index *HSI 17165.87 0 0
.AXJO S&P/ASX 200 *ASX 200 6524.6 -30.4 -0.46
.SSEC Shanghai *SHANGHAI 3041.2 0 0
.KS11 KOSPI Index *KOSPI 2148.41 -22.52 -1.04
.FTFCNBCA CNBC 100 ASIA IDX *CNBC 100 6952.46 -32.38 -0.46

— Sarah Min and Samantha Subin contributed to this report.

Japan’s industrial production rises more than expected

Industrial production in Japan grew 2.7% in August from July, according to official data, marking the third consecutive month of growth. That figure soundly beats expectations of a 0.2% increase in a Reuters poll.

Retail sales also jumped 4.1% in August compared with a year ago, beating a Reuters forecast of a 2.8% rise.

— Abigail Ng

CNBC Pro: Is the Fed on the right track? Wall Street veteran Ed Yardeni says this is what it should do next

The U.S Federal Reserve announced yet another 75 basis point hike earlier this month, sending the federal funds rate up to a range of 3% to 3.25%. The central bank also signaled it may raise interest rates up to as high as 4.6% in 2023 to control inflation.

Ed Yardeni, the economist who coined the term “bond vigilantes,” gives his take as the Fed’s response to inflation comes under intense scrutiny.

— Zavier Ong

Fed’s Loretta Mester says interest rates are not yet restrictive

Cleveland Federal Reserve President Loretta Mester said interest rates are not yet restrictive, and there’s more to be done to bring down inflation.

“Inflation is still at a 40 year high,” Mester told CNBC’s Steve Liesman during an appearance on “Squawk Box.” “So right now the conversation has to be we have to do, what we must do to get back to price stability, because we can’t have a healthy economy, we can’t have good labor markets over time, unless we get back to price stability.”

Mester said she’s probably “a little bit above the median path” among Fed officials when it comes raising interest rates, citing the persistence in inflation.

“We’re still not even in restrictive territory on the funds rate, so you’re right, we’ve moved the funds rate up 300 basis points this year, but look how high inflation is,” Mester said.

— Sarah Min

Source : CNBC

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