In Hong Kong, Hang Seng lost 2.8%, causing losses in the region. The Japanese Nikkei also fell more than 2%. Kospi in Korea fell 1.6%. China’s Shanghai Composite Index fell 1%.
Futures on Asian stock markets continued their downward trend on Thursday morning. Dow futures fell 0.4%. S&P 500 futures and Nasdaq futures fell 0.5% and 0.8%, respectively.
IG Group market strategist Jun Rong Yeap said on Thursday that high inflation readings from the UK and Canada “remind markets globally that tackling inflation will be a challenging process among central banks”.
“The rise in Covid-19 cases in China dampens previous hopes for a rapid relaxation in overall virus restrictions and potentially contributes to market risk aversion,” he said.
These concerns were reinforced by a worse-than-expected result Wednesday, when Tencent reported zero first-quarter revenue growth.
“Despite recent assurances by Chinese authorities, the relief in Chinese technology has so far been short-lived as market participants await more concrete policy follow-up to restore longer-term confidence,” Yeap said.