Stock market today: Asian markets extend losses after Wall Street drifts lower

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BANGKOK (AP) — Stocks in Asia fell Thursday after Wall Street drifted lower after a rally that sent them up 16% for the year so far.

Hong Kong’s Hang Seng fell 3% amid a sell-off in Chinese bank stocks after Goldman Sachs downgraded them on concerns about a slowing economy and lenders’ exposure to debt. Japan’s Nikkei 225 lost 1.7%. US futures fell and oil prices were mixed.

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Stock prices have soared recently amid signs that the US economy is stronger than feared, fighting recession so far despite higher interest rates. Minutes of the Fed’s latest policy meeting released on Wednesday showed that some central bank officials wanted to raise interest rates in mid-June, though they ultimately voted unanimously to keep rates steady.

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The threat of a rate hike was weighing on investor sentiment. The next focus for the US will be the jobs data due on Friday.

Markets are also watching updates on US-China tensions as Treasury Secretary Janet Yellen heads to Beijing for several days of meetings.

The Hang Seng Index fell 550 points to 18,559.82, while the Shanghai Composite Index lost 0.5 percent to 3,206.36 points. The Nikkei 225 index in Tokyo lost 565 points, to 32,773.02 points.

Hong Kong-traded shares of China Construction Bank Corp lost 2.8%; China Merchants Bank fell 1.4% and Industrial and Commercial Bank of China fell 3.2%.

In Australia, the S&P/ASX 200 fell 1.3% to 7,157.80 and the Kospi in Seoul lost 1.1% to 2,551.10. India’s Sensex rose 0.3%, while shares in Taiwan fell 1.7% and 1.3% in Bangkok.

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On Wednesday, the S&P 500 fell 0.2% to 4446.82, down from its highest level since April 2022. The Dow fell 0.4% to 34288.64 and the Nasdaq fell 0.2% to 13791.65.

A report on Wednesday showed that growth in US factory orders stabilized in May, although economists expected it to see an acceleration.

On Wall Street, UPS shares fell 2.1% as the company tries to strike a deal with the Teamsters union that represents about 340,000 of its workers. Their current contract expires at the end of the month, and last month the Teamsters voted in favor of a license to strike.

Companies that do a lot of business in the China region were also weak. Las Vegas Sands and Wynn Resorts, which get a significant amount of revenue from Macau, both fell by at least 4.6%.

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On the winning side were Meta Platforms. The parent company of Facebook, Instagram, and WhatsApp seems ready to unveil a new app that appears to mimic Twitter. It rose 1.9%, adding to a stellar year where it was already up 144.6%.

The hope is high that inflation is cooling enough to cause the Federal Reserve to soon halt its interest rate increases, which are undermining inflation by slowing the entire economy. Many on Wall Street are expecting the Fed to raise interest rates later this month and possibly again later this year, as the Fed has been hinting at.

That could leave the US stock market stuck in a waiting pattern as everyone waits to see whether or not a long anticipated recession will happen. The upcoming earnings report season could offer some clues, as companies tell investors how much they earned during the spring.

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Returns have been mixed in the bond market. The yield on the 10-year Treasury rose to 3.96% from 3.86% on Monday, when the bond ended early trading ahead of the Independence Day holiday. The 10-year yield helps set rates for mortgages and other important loans.

The two-year Treasury yield, which moves further based on the Fed’s forecast, held steady at 4.94%.

In other dealings, the price of US crude oil fell 9 cents to $71.70 a barrel in electronic trading on the New York Mercantile Exchange. On Wednesday, it rose two dollars a gallon to $71.79 a barrel.

Brent crude, which is the basis for pricing international trade, lost 26 cents to $76.39 a barrel.

The dollar fell to 143.76 yen from 144.64 yen. The euro rose to $1.0861 from $1.0857.

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