By Associated Press
Stocks were mixed in Asia on Tuesday after closing broadly lower on Wall Street, where the Dow Jones Industrial Average fell into what’s known as a bear market.
The week started out with a bout of selling amid an extended slump for many markets. The benchmark S&P 500 is down more than 7% in September.
Tokyo’s Nikkei 225 index /zigman2/quotes/210597971/delayed JP:NIK -0.40% picked up 0.8% and the S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.75% in Sydney added 0.2%. The Shanghai Composite index /zigman2/quotes/210598127/delayed CN:SHCOMP -0.07% rose 0.2%, while Hong Kong’s Hang Seng index /zigman2/quotes/210598030/delayed HK:HSI +3.38% shed 0.9%. In Seoul, the Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.49% lost 0.9%. Stocks ticked higher in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 -0.53% , but fell in Singapore /zigman2/quotes/210597985/delayed SG:STI +0.33% , Malaysia /zigman2/quotes/210598052/delayed MY:FBMKLCI -0.06% and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX -0.21% .
Stocks have been sagging under concerns over stubbornly hot inflation and the risk that central banks could trigger recessions as they try to cool high prices for everything from food to clothing.
Investors have been particularly focusing on the Federal Reserve and its aggressive interest rate hikes. But volatility in currency markets has further roiled markets in recent days.
The British pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.0819% dropped to an all-time low against the dollar on Monday and investors continued to dump British government bonds in displeasure over a sweeping tax cut plan announced in London last week.
The Japanese yen /zigman2/quotes/210561418/realtime/sampled JPYUSD +0.1143% edged toward 145 to the dollar early Tuesday. Last week, the Bank of Japan intervened in the market as the yen slipped past 145, gaining a brief reprieve. But the dollar’s surge against other currencies is putting pressure on the BOJ and other central banks, especially in developing economies facing growing costs for repaying foreign loans.
The pound was at $1.0765, up from $1.0686 late Monday. The dollar bought 144.49 yen, down from 144.65 yen, and the euro rose to 96.29 cents from 96.10 cents.
Companies are nearing the close of the third quarter and investors are awaiting the next round of earnings reports. That will give them a better sense of how companies are dealing with persistent inflation.
Several economic reports are on tap for this week that will give more details on consumer spending, the jobs market and the broader health of the U.S. economy.
The latest consumer confidence report, for September, from the business group The Conference Board will be released on Tuesday. The government will release its weekly report on unemployment benefits on Thursday, along with an updated report on second-quarter gross domestic product.
On Friday, the government will release another report on personal income and spending that will help provide more details on where and how inflation is hurting consumer spending.
Seeking to make borrowing more expensive and crimp spending, the Fed raised its benchmark rate, which affects many consumer and business loans, again last week. It now sits at a range of 3% to 3.25%. It was near zero at the start of the year. The Fed also released a forecast suggesting its benchmark rate could be 4.4% by the year’s end, a full point higher than envisioned in June.
The U.S. economy is already slowing, raising worries that rate hikes might cause a recession. The Dow /zigman2/quotes/210598065/realtime DJIA +0.81% became the last of the major U.S. stock indexes to fall into what’s known as a bear market Monday, falling 1.1% to 29,260.81.
The Dow is now 20.5% below its all-time high set on Jan. 4. A drop of 20% or more from a recent peak is what Wall Street calls a bear market.
In other trading on Tuesday, U.S. benchmark crude added 28 cents to $76.99 per barrel in electronic trading on the New York Mercantile Exchange. It sank $2.03 to $76.71 on Monday.
Brent crude , used for pricing international oils, rose 32 cents to $83.18 per barrel.