Asian stocks plunge after US stocks suffer biggest daily drop since 2020
Asian shares fell and European stock futures fell in early trading on Thursday after Wall Street stocks suffered their worst day since the start of the coronavirus pandemic on worrisome new signs of bullishness. economic growth declines.
The falls bring a 4% off for the US S&P 500 stock index on Wednesday, its biggest single-day drop since June 2020, with 98% of stocks in the benchmark slide.
The sharp drop was triggered by concerns that rising inflation would dampen global growth after weak results from consumers underscoring higher prices have hit both retail spending and supply chain costs.
US Retailer Target leading the dropfell 25% after warning that its margins were under pressure, a day after its larger rival Walmart issued a similar warning. Both retailers recorded their worst daily declines since 1987 this week.
In Europe, stock futures fell when local markets opened, with London’s FTSE 100 and Euro Stoxx 50 followers falling 0.6% and 1% respectively.
Hong Kong-listed shares of Chinese internet giant Tencent fell 8.6%, helping to drag the Hang Seng Tech index down 3.6% and the broader Hang Seng index 2.4% lower. Elsewhere in the region, Japan’s Topix and South Korea’s Kospi are both down about 1.5%.
Tencent’s downfall comes after the Chinese Internet conglomerate reported slowest revenue growth on record. The company recorded a 51% drop in profits in the first quarter due to Beijing’s crackdown on the tech sector and the impact of the harsh Covid-19 lockdown on consumer spending.
Charlie Chai, an analyst with 86Research, said Tencent’s “pretty impressive” results in games, advertising and new business services were “a reflection of the big picture”. [in China]“When business confidence goes down that translates to a reduction in corporate spending.
With China’s economic outlook deterioratesStandard Chartered cut its annual growth forecast for the world’s second-largest economy to 4.1% from 5%.
Shares of US technology corporations were also affected on Wednesday, with Apple, Nvidia and Amazon all falling more than 5% while the Nasdaq Composite index closed down 4.7%.
Additional reporting by Primrose Riordan in Hong Kong