Asian stock markets experienced a significant downturn on Wednesday, reaching a two-month low, as investors exercised caution ahead of the upcoming U.S. Consumer Price Index (CPI) report. The anticipated inflation data is expected to influence the Federal Reserve’s monetary policy decisions, prompting a risk-averse sentiment across the region.
In Japan, the Nikkei 225 index fell by 1.2%, closing at 34,800. This decline was led by losses in the technology and automotive sectors, reflecting concerns over potential interest rate adjustments by the Federal Reserve.
Hong Kong’s Hang Seng index dropped 1.5% to 23,500, with real estate and financial stocks bearing the brunt of the sell-off. Investors are wary of the impact that U.S. inflation data may have on global liquidity and capital flows, which are critical to Hong Kong’s open economy.
China’s Shanghai Composite index decreased by 0.8% to 3,200, amid ongoing economic challenges and regulatory uncertainties. The market remains sensitive to external economic indicators, such as U.S. inflation data, which could affect China’s export-driven economy.
