BEIJING (AP) — Asian stock markets followed Wall Street down on Wednesday after U.S. inflation was lower than expected amid unease about the impact of the spread of the coronavirus’s delta variant.
Shanghai, Tokyo, Hong Kong and Sydney all retreated, giving up the previous day’s gains.
Wall Street’s benchmark S&P 500 index fell despite data showing consumer prices rose at their slowest rate in seven months in August.
Investor optimism about the rollout of coronavirus vaccines and central bank support for global economies is competing with anxiety about the impact of the delta variant and anti-disease measures on consumers and businesses.
“Initial optimism from a lower-than-expected print on the U.S. CPI was quickly overridden by global growth concerns,” Yeap Jun Rong of IG said in a report.
The Hang Seng HSI, -1.95% in Hong Kong slid 1.5% to 25,117.71. The Shanghai Composite Index SHCOMP, -0.61% lost 0.2% to 3,655.30 and the Nikkei 225 NIK, -0.52% in Tokyo sank 0.5% to 30,510.05. The Kospi 180721, +0.25% in Seoul gained 0.2% to 3,157.42 while Sydney’s S&P-ASX 200 XJO, -0.27% retreated 0.2% to 7,421.50. New Zealand and Southeast Asian markets declined.
Investors also got a batch of weak China economic data, with retail sales, industrial output and fixed-asset investment all indicating cooling activity, owing to coronavirus outbreaks and tougher measures to control the virus.
Macau casino stocks tumbled in Hong Kong after the Macau government issued a document Tuesday that laid out recommendations for stricter regulations within the gaming hub. Among the deep losses, shares of Sands China Ltd. 1928, -30.58% SCHYY, -7.63% and Wynn Macau Ltd. 1128, -27.97% WYNMY, -9.59% slumped around 28% each.
On Wall Street, the S&P 500 SPX, -0.57% lost 0.6% to 4,443.05, giving up the previous day’s gain, after the government reported consumer prices in August rose 0.3% over the previous month.
The benchmark’s 11 sectors all ended in the red. Banks, energy stocks and industrial and communication companies were among the biggest drags on the index.
Investors worry higher inflation might make the Federal Reserve and other central banks feel pressure to wind down easy credit and other stimulus that is helping to push up stock prices. The Fed has said it believes a spike in U.S. consumer inflation was temporary and interest rates will be kept low until a recovery is established.
In energy markets, benchmark U.S. crude CL00, +0.70% rose 52 cents to $70.98 per barrel in electronic trading on the New York Mercantile Exchange. The contracted added 1 cent on Tuesday to $70.46. Brent crude BRN00, +0.68%, the price basis for international oils, advanced 56 cents to $74.16 per barrel in London. It gained 9 cents the previous day to $73.60 a barrel.
MarketWatch contributed to this report.