Asian stocks declined as a sell-off in once much-favored U.S. technology shares deepened and volatility soared, weighing on markets that resumed trading after the long Easter break. Havens like the yen maintained gains and Treasuries steadied.
Equity benchmarks fell in Tokyo and Seoul, and retreated in Hong Kong where traders returned to their desks after a four-day weekend. Losses were cushioned as U.S. equity futures climbed. Australia’s Santos Ltd. surged after the energy producer received a takeover offer, helping the benchmark erase a decline on the first trading day after the Easter break. The South Korean won fell from a three-year high as officials warned against excessive movements. The Australian dollar had the biggest gain among G10 currencies against the greenback.
The S&P 500 Index closed below its average price for the past 200 days for the first time since June 2016, with fresh presidential criticism of Amazon.com and retaliatory tariffs from China rattling investors. The Cboe Volatility Index jumped 18 percent.
After the worst three months for global stocks in more than two years, the second quarter started on the back foot as trade-tension worries festered and technology shares got slammed. The risk-off tone comes two weeks before earnings season begins, with investors still anticipating a strong showing, though watchful for signs of any slowdown in the synchronized global expansion and strains from Federal Reserve tightening.
“What we are really seeing across the economies and markets are opposing forces playing out: in the economy you are seeing Fed versus inflation, in markets you are seeing momentum versus fundamental supports,” JPMorgan Asset Management Global Market Strategist Hannah Anderson told Bloomberg TV. “Investors need to be aware of these opposing forces along with a lot of the headline risk we are seeing come through when it comes to trade and regulation and how that’s going to impact their portfolios.”
Fanning the rout in tech, the biggest gainers of the bull run, U.S. President Donald Trump renewed his attack on Amazon, sending shares of the online retailer down the most in more than two years. Intel Corp. also had its worst day in two years, after Apple Inc. was said to be planning to use its own chips in Mac computers from 2020.
JPMorgan Asset Management Global Market Strategist Hannah Anderson weighs on volatility and market turmoil.
Elsewhere, the Reserve Bank of Australia left interest rates unchanged at its monthly meeting. Crude steadied after its biggest loss in almost two months as fears of a trade war prompted investors to dump commodities and gold held onto gains.
Here are some key events coming up this week:
The New York Fed debuts the Secured Overnight Financing Rate on Tuesday.
The Reserve Bank of India decides on policy Thursday.
U.S. employment data are due Friday; the jobless rate probably fell in March after holding at 4.1 percent for five straight months.
These are the main moves in markets:
The Topix index fell 0.2 percent as of 2:03 p.m. in Tokyo.
Australia’s S&P/ASX 200 Index was little changed.
Hong Kong’s Hang Seng Index fell 0.6 percent. The Shanghai Composite Index lost 0.9 percent.
South Korea’s Kospi index declined 0.3 percent.
Futures on the S&P 500 Index were 0.4 percent higher. The main gauge declined 2.2 percent Monday. The index is now lower by more than 10 percent from its January record. The Nasdaq 100 tumbled 2.9 percent.
The MSCI Asia Pacific Index decreased 0.2 percent.
The Bloomberg Dollar Spot Index lost 0.1 percent.
The euro rose less than 0.1 percent to $1.2310.
The yen fell less than 0.1 percent to 105.95 per dollar after gaining 0.3 percent Monday.
The Australian dollar rose 0.4 percent to 76.91 U.S. cents.
The yield on 10-year Treasuries rose about one basis point to 2.74 percent.
The Australian 10-year bond yield fell one basis point to 2.59 percent.
West Texas Intermediate crude rose 0.2 percent to $63.13 a barrel. It lost 3 percent on Monday.
Gold fell 0.2 percent to $1,338.28 an ounce after jumping 1.2 percent.