Asian Markets Muted As Traders Warily Eye More Fed Rate Hikes


Asian stocks fell on Monday after Wall Street closed lower last week and China tightened anti-virus regulations.

The Shanghai Composite rose 0.1% as the Chinese government tightened restrictions on movement in Shenzhen, the southern economic hub, due to the virus outbreak.

The KOSPI fell 0.2%, while the S&P/ASX 200 was flat in Sydney. Benchmarks in Singapore and Indonesia rose, while Taiwan and New Zealand fell.

Forecasters say further rate hikes may be needed to reduce four-year high inflation and note that job creation remains strong.

IG Yeap Jun Rong said in a note that Asian trade could be "muted" due to Wall Street's "failed attempt to recover" after the release of jobs data.

Traders are closely watching the Fed after Fed Chairman Jerome Powell said on Aug. 26 that higher interest rates were needed to dampen demand for higher rates. That dashed expectations that the Fed might change course in response to signs that U.S. economic activity is slowing.

The Dow Jones Industrial Average also fell 1.1% on Friday after the Labor Department said the US economy added 315,000 jobs in August. That's a significant drop from July's 526,000, but average hourly earnings also rose 5.2 percent from a year earlier.

The Russian state energy company "Gazprom" also warned on Friday that it will expand the supply of natural gas to Germany via the "Nord Stream 1" pipeline. The company announced last Wednesday that gas supplies would be interrupted for three days due to repairs.

U.S. crude, the energy benchmark, rose $1.48 to $88.35 a barrel on the New York Mercantile Exchange's computerized trading platform. The contract rose 26 cents to $86.87 on Friday.

Brent crude, the global oil trading benchmark, rose $1.59 to $94.61 a barrel in London. It rose 66 cents to $93.02 in the previous session.


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