HONG KONG: Asian stocks weakened on Monday (May 23) as investors worried inflation and rising interest rates would hamper the global economic outlook and China's COVID-19 situation weighed on sentiment, with tech firms particularly hit.
MSCI's broadest index of Asia-Pacific shares outside Japan was down
0.3 per cent as the region's major markets traded in the red. Oil rose
and gold extended its recent gains.
However, US and European markets appeared to shrug off the gloomy Asian mood with the pan-region Euro Stoxx 50 futures up 1.35 per cent, German DAX futures 1.4 per cent higher and FTSE futures climbing 0.83 per cent. S&P 500 futures rose 1.04 per cent.
Australian shares reversed early gains to be down 0.13 per cent on Monday while Japan's Nikkei stock index bucked the regional trend and was 0.7 per cent higher.
A negative tone was evident as Hong Kong's Hang Seng Index slid 1.27 per cent and the mainland's CSI300 Index dropped 0.7 per cent, weighed by the tech sector. The Hang Seng Tech Index dropped 2.2 per cent and is down 26.5 per cent so far this year.
"The sell off in Asia is primarily driven by the negative global sentiment that exists at the moment," Jack Siu, Credit Suisse's greater China chief investment officer, told Reuters.
China's tech sector, he added, would remain volatile until there was greater regulatory clarity and US markets stabilised.
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