Asian Shares Slide On U.S. Rate Hike, Evergrande Woes

Asian stocks fell broadly on Monday as lingering worries over a U.S. rate hike offset investor optimism that the Omicron coronavirus variant might not have as much of an impact on the global economy as feared.

Chinese shares ended lower as concerns over the fallout from a likely default by China Evergrande Group overshadowed Premier Li Keqiang’s comments on a reduction in reserve requirement ratios.

The benchmark Shanghai Composite Index dropped 18.13 points, or 0.5 percent, to 3,589.31, with semiconductor and new energy shares pacing the declines.

Hong Kong’s Hang Seng Index tumbled 417.31 points, or 1.8 percent, to 23,349.38 ahead of a slew of Chinese data due on Wednesday.

Japanese shares ended off their day’s lows after initial Omicron reports detailed mild illness and asymptomatic cases. The Nikkei 225 Index ended down 102.20 points, or 0.4 percent, at 27,927.37 after losing as much as 1.2 percent earlier in the session. The broader Topix closed 0.5 percent lower at 1,947.54.

Heavyweight SoftBank Group slumped 8.2 percent to extend recent losses on concerns over valuations of key companies in its portfolio.

Australian markets ended on a flat note ahead of the RBA meeting on Tuesday, with economists expecting the central bank to hold its cash rate at a record-low 0.1 percent.

The benchmark S&P/ASX 200 Index finished marginally higher, while the All Ordinaries index slipped 0.2 percent to 7,529 amid firmer Treasury yields and worries over rising Covid-19 cases in Sydney and other cities.

Energy and gold stocks advanced, underpinned by firmer bullion and oil prices. Technology stocks fell, with aerial imagery firm Nearmap plunging more than 7 percent to end at its lowest since April 2020.

Afterpay tumbled 4.3 percent to close at a six-month low and Zip Co plummeted over 10 percent to reach its lowest level in more than 18 months. Mining heavyweights BHP and Rio Tinto ended down 1.6 percent and 1.8 percent, respectively.

Seoul stocks extended gains for the fourth straight session, though the upside remained capped by fears from China’s Evergrande and Fed rate hike woes. The Kospi inched up 4.92 points, or 0.2 percent, to 2,973.25, led by gains in tech and auto stocks.

New Zealand shares fell notably amid rising Omicron fears and expectations on the Federal Reserve rate hike. The benchmark NZX-50 Index dropped 78.69 points, or 0.6 percent, to 12,597.81, dragged down by utilities. Genesis Energy lost 4.2 percent and Meridian Energy gave up 3.6 percent.

U.S. stocks ended on a downbeat note Friday as bond yields fell at a pace not seen since some of the worst days of the pandemic last year on data showing U.S. job growth slowed considerably in November.

Non-farm payroll employment rose by 210,000 jobs in November, while economists had expected employment to spike by 550,000 jobs.

However, a separate report showed an unexpected acceleration in the pace of growth in U.S. service sector activity in the month.

The tech-heavy Nasdaq Composite tumbled 1.9 percent to hit its lowest closing level in well over a month, while the Dow edged down 0.2 percent and the S&P 500 eased 0.8 percent.

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