{"id":110497,"date":"2021-01-28T01:51:26","date_gmt":"2021-01-28T01:51:26","guid":{"rendered":"https:\/\/precoinnews.com\/?p=110497"},"modified":"2021-01-28T01:51:26","modified_gmt":"2021-01-28T01:51:26","slug":"asia-stocks-follow-wall-street-tumble-on-valuation-worries","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/markets\/asia-stocks-follow-wall-street-tumble-on-valuation-worries\/","title":{"rendered":"Asia stocks follow Wall Street tumble on valuation worries"},"content":{"rendered":"
NEW YORK (Reuters) – Asian stocks skidded on Thursday following a sharp Wall Street decline amid deepening concerns about stretched valuations in equities markets, while the dollar and bonds strengthened.<\/p> In early Asian trade, Australia\u2019s S&P\/ASX 200 benchmark lost 1.99%, Japan\u2019s Nikkei fell 2.28% and Hong Kong\u2019s Hang Seng index futures lost 0.51%. S&P futures pulled back 1%.<\/p>\n Adding to the market worries was the outcome of Federal Reserve\u2019s policy meeting. While the Fed kept settings unchanged as expected, policymakers flagged a concerning slowdown in the pace of the economic recovery.<\/p>\n On Wall Street, the benchmark S&P 500 index fell nearly 2.57%. The Dow Jones Industrial Average fell 2.05% and the Nasdaq Composite dropped 2.61%.<\/p>\n Boeing Co dragged on the Dow by falling 3.97% on a $6.5 billion charge for its delayed 777X jetliner and crash-plagued 737 MAX.<\/p>\n Michael McCarthy, chief market strategist at CMC Markets in Sydney, said the wider stock selloff was surprising, given strong fourth-quarter results from tech giants.<\/p>\n \u201cA little bit of a sell-the-fact response,\u201d McCarthy said, noting stock valuations are at toppy levels. \u201cIt might not have everything to do with the Fed.\u201d<\/p>\n Noting there was no urgency in dollar or bond-buying, he said: \u201cMaybe what we need is a good old-fashioned panic\u201d to cool valuations.<\/p>\n The S&P and Dow are down 0.14% and 0.99%, respectively, so far this year.<\/p>\n U.S. Treasury yields remained lower, and the dollar index rose 0.559%, with the euro down 0.07% to $1.21.<\/p>\n Upbeat U.S. corporate earnings were not enough to pull the benchmarks higher. Microsoft Corp initially rose but erased most of the gains to end up 0.25%.<\/p>\n Facebook shares edged up 0.68% while Tesla fell 2.10% after the close. Apple shares also dipped in extended trade after its results.<\/p>\n These heavyweights have come back into favor as investors dumped economy-linked banks, energy and small-cap stocks.<\/p>\n On the macro level, the Fed\u2019s steady stance shifts the spotlight to how soon and how much fiscal stimulus the U.S. Congress can agree to muster to support the economy.<\/p>\n \u201cThe focus is firmly on the fiscal side of the equation now,\u201d Rick Rieder, BlackRock\u2019s chief investment officer of global fixed income, said in a note.<\/p>\n Stimulus checks and extended unemployment insurance have been important to the U.S. recovery and are \u201cfar more targeted and effective in combating a crisis…than \u2018blunt\u2019 monetary policy tools,\u201d he added.<\/p>\n Though the U.S. vaccination program may help the economy reopen and rebound more fully later this year, for now Fed officials signaled they see it in a deep hole, with high levels of joblessness, ailing small businesses, and a recent surge in COVID-19 infections.<\/p>\n The pan-European STOXX 600 index lost 1.16% and MSCI\u2019s gauge of stocks across the globe shed 2.04%.<\/p>\n The Japanese yen weakened 0.01% versus the greenback at 104.12 per dollar.<\/p>\n