(FreedomBeacon.com)- Again, Asian stocks fell. German inflation surged, British Prime Minister Liz Truss defended a tax-cut plan, and Chinese manufacturing fell.
Tokyo, Hong Kong, Shanghai, and Sydney fell. Oil fell.
Wall Street’s benchmark S&P 500 index plummeted 2.1% on Thursday to its lowest level in over two years as solid U.S. jobs data bolstered expectations for future interest rate hikes.
Investors fear a global recession as the Fed, Europe, and Asia raise interest rates to calm multi-decade high inflation. Russia’s invasion of Ukraine has impacted oil and gas markets.
Germany’s September inflation surged to 10.9%, and Chancellor Olaf Scholz warned of a “double punch” from rising energy prices.
ING economists have said that we” haven’t seen the bottom yet.”
The Shanghai Composite Index fell 0.6% to 3,023.91 after manufacturing surveys showed September production and new orders fell.
The Nikkei 225 sank 1.7% to 25,979.75 and the Hang Seng fell 0.2% to 17,126.01. Seoul’s Kospi rose 0.2% to 2,173.71.
Sydney’s ASX 200 fell 0.7% to 6,506.20. New Zealand and SE Asia fell.
Investors were uneasy before Truss’s administration revealed multibillion-dollar tax cuts. Traders fear that will increase already high inflation, leading the British central bank to raise interest rates.
Stock markets and the pound rose Wednesday after the Bank of England declared it would buy government bonds. Thursday, markets fell again after Truss reaffirmed her tax-cut plan despite an IMF call to reverse course.
S&P 500 dropped to 3,640.47. More than 90% of the index’s components fell, putting it on course to lose 8% in September.
The Dow slid 1.5% to 29,225.61 while the Nasdaq fell 2.8% to 10,737.51.
The S&P 500 is down more than 20% for the year as investors wait for inflation to slow after the Fed raised rates five times.
The two-year U.S. Treasury yield rose to 4.2% from 4.14% on Wednesday.
Stronger-than-expected U.S. employment figures Thursday strengthened hopes the Fed will boost interest rates further and keep them high until next year.
Last week, fewer people claimed unemployment than expected.
Caixin detected a drop in Chinese manufacturers’ production and orders. This was expected because of weak global demand.
The Caixin monthly purchasing managers’ index fell from August, but a second indicator by the China Federation of Logistics & Purchasing rose over break-even.
Capital Economics’ Zichun Huang predicts external demand will decline.
U.S. crude fell 9 cents to $81.14 on the NYMEX. Thursday’s contract price was $81.23. Brent crude fell 10 cents to $87.08 a barrel in London. Previous session.
The dollar/yen increased to 144.70 from 144.43 on Thursday. The euro increased to 98.05.