Sun, 28 Nov 2021

Asian stocks reel as oil hike raises fears of inflation

Lola Evans
05 Oct 2021, 16:48 GMT+10

SYDNEY, NSW, Australia - Higher oil prices saw Asian markets get the jitters on Tuesday, following a wholesale sell-off on Wall Street overnight.

Higher oil prices triggered fears of inflation, resulting in sold falls on some of the major bourses. "Investors are clearly worried about inflation due to supply chain disruptions and the rally in energy prices," Vasu Menon, executive director of investment strategy at OCBC Bank was quoted as saying Tuesday by Reuters news agency.

"We have seen tech stocks outperform value stocks, so if inflation remains a worry, then tech stocks tend to get hit," Menon added.

China Evergrande, facing $500 million in interest payments in the next 3 months continues to create uncertainty among property stocks in Hong Kong and China.

Chinese mainland markets were closed on Tuesday for a public holiday. The Hang Seng in Hong Kong edged higher, adding 67.78 points or 0.28 percent to 24,105.15.

The big action was in Japan where the Nikkei 225 plummeted 622.77 points or 2.19 percent to close at 27,822.12.

The Australian All Ordinaries fell 40.30 points or 0.53 percent to 7,536.50. Technology shares fell more than three percent. The Reserve Bank of Australia left official interest rates unchanged at 0.10 percent Tuesday.

New Zealand's benchmark S&P/NZX 50 index fell more than 1 percent to 13,199.99.

The U.S. dollar rebounded in Asia after moderate losses overnight. The euro slipped to 1.2595 by the Sydney close Tuesday. The British pound dipped to 1.3595. The Japanese yen weakened to 111.16. The Swiss franc eased to 0.9265.

The Australian dollar declined to 0.7257. The New Zealand dollar was lower at 0.6934.

Overnight on Wall Street, the Nasdaq Composite shed 311.21 points or 2.14 percent to 14,255.48.

The Dow Jones index tumbled 323.52 points or 0.94 percent to 34,002.72.

The Standard and Poor's 500 declined 56.58 points or 1.30 percent to 4,300.46.

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