Asian markets opened under pressure after another weak session on Wall Street, with investors dumping risk assets as worries about global growth intensified.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.55 percent. Australian stocks lost 1 percent, while Japan’s Nikkei dropped 1.3 percent.
The selloff followed a second straight day of losses in U.S. equities on Tuesday, when energy shares fell with oil prices and retailers including Target and Kohl’s slid after disappointing earnings and forecasts. The Nasdaq finished at its lowest level in more than seven months, while the S&P 500 and Dow closed at their weakest since late October.
Soichiro Monji, senior economist at Daiwa SB Investments, said: “It is difficult to pinpoint a single factor driving the global risk aversion. Apple and trade tensions seem to be touted as factors every other day, but it is difficult to blame them for all the woes,”
He added: “The markets appear to be starting to prepare for a loss of momentum in the global economy, although it is doing quite well at the moment.”
The dollar strengthened as investors sought safety, with the dollar index against six major currencies at 96.800 after rising 0.7 percent overnight. That came after it had slipped to a two-week low of 96.042 earlier in the week.
Federal Reserve officials had already unsettled currency markets with cautious comments about the global economic outlook, prompting traders to question whether the central bank would slow the pace of rate increases or bring its tightening cycle to an end.
The euro was little changed at $1.1370 after falling 0.75 percent the previous day. The dollar stood at 112.765 yen after edging up 0.2 percent on Tuesday.
Risk-sensitive currencies also weakened. The Australian dollar held flat at $0.7215 after a 1 percent drop, while the Canadian dollar remained near a five-month low of C$1.3318 per dollar reached on Tuesday, when it lost more than 1 percent.
Oil markets were also under strain. U.S. crude futures inched up a cent to $53.44 per barrel after tumbling about 6 percent to $52.77 on Tuesday, their lowest since late October 2017. The decline came as the broader Wall Street rout and fears of slower global growth weighed on demand expectations.
Reporting by Shinichi Saoshiro, editing by Eric Meijer
