Hong Kong, Sept. 20 (BUS): Shares fell more than 3% in Hong Kong on Monday amid thin trade in Asia, with other major markets closed in Tokyo and Shanghai.
Other regional benchmarks also fell after Wall Street concluded last week with another drop, the Associated Press reports.
Investors are watching to see if the Federal Reserve will take any action to address the impact of higher prices on businesses and consumers.
Real estate companies and banks in Hong Kong have lost ground due to continuing concerns about the potential for ripple effects from the financial problems of Chinese property developer Evergrande.
The company was expected to lose interest payments, as rating companies speculated that it could default on its debt.
Hong Kong’s Hang Seng fell 3.5% to 24035.30 and Australia’s S&P/ASX 200 fell 1.6% to 7,287.90. Markets have been closed in mainland China, South Korea, Japan and Malaysia.
The Federal Reserve is due to provide its latest update on its economic policy and interest rates on Wednesday. The central bank said higher costs for raw materials and consumer goods are still likely to be temporary as the economy recovers, but analysts fear higher prices could persist and affect companies’ bottom lines while also reducing spending.
The yield on the 10-year Treasury fell to 1.37% from 1.38% on Friday.
Stocks closed lower on Wall Street on Friday, marking a weak end to a bullish and bearish trading week. The S&P 500 lost 0.9% to 4432.99, its second consecutive weekly loss.
Nearly 80% of stocks in the S&P 500 fell, and every sector except healthcare was in the red.
The Dow Jones Industrial Average fell 0.5% to 34584.88, and the Nasdaq fell 0.9% to 15,043.97.
Technology and telecoms companies were the biggest hurdles in the market.
The Russell 2000 index of smaller companies recovered from an early slide, rising 0.2% to 2236.87.
The “magic quad,” the simultaneous expiration of four types of options and futures contracts, contributed to market volatility. This phenomenon occurs four times a year and forces traders to tie up the contracts they own. McKnight said more than 750 billion individual stock options were due to mature on Friday.
In other trading on Monday, benchmark US crude oil lost 65 cents to $71.32 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, it fell 64 cents to 71.97 dollars a barrel.
Brent crude, the international pricing benchmark, lost 57 cents to $74.79 a barrel.
The US dollar fell to 109.90 yen from 109.95 yen. The euro fell to $1.1716 from $1.1731.