Asia markets fell in early trade on Monday, following a sharp decline in U.S. stocks on Friday amid a stronger-than-expected jobs report that sent interest rates higher.
In Australia, the ASX 200 fell 1.31 percent to 6,041.40 in morning trade, with most sectors trading lower. The heavily weighted financial subindex was down 1.07 percent, while the energy and materials sectors fell 2.14 percent and 2.13 percent, respectively.
The biggest banking names in the country fell: Shares of ANZ were down 1.2 percent, Commonwealth Bank declined 0.89 percent, Westpac was down 1.23 percent and the National Australia Bank fell 1.12 percent.
Major Australian miners were also down. Rio Tinto shares fell 2.36 percent, Fortescue was down 1.4 percent and BHP Billiton declined 2.69 percent.
In Japan, the Nikkei 225 fell 2.06 percent in early trade, while the Topix index was down 1.71 percent. South Korea’s Kospi index fell 1.66 percent.
Elsewhere, U.S. futures fell notably as Wall Street added to the large losses set last week. The Dow Jones industrial average futures were down 223 points at 8:13 a.m. HK/SIN, after briefly falling more than 250 points. S&P 500 and Nasdaq futures fell 19 points and 38.75 points, respectively.
On Friday, the Bureau of Labor Statistics said the U.S. economy added 200,000 jobs in January. That number was higher than the 180,000 jobs expected by economists in a Reuters poll. Wages, meanwhile, rose 2.9 percent on an annualized basis. The report sent Treasury yields higher, adding to investor concerns that interest rates may be rising too fast.
One analyst said the move in the U.S. market still had some way to go — and that the pullback will continue to affect most equity markets.
“The past week has seen shares come under pressure as Fed rate hike expectations increased, partly reflecting an acceleration in U.S. wages growth, and the bond yield rose sharply,” Shane Oliver, head of investment strategy and chief economist at AMP Capital, said in a Monday morning note.
“It’s likely the pullback has further to go as investors adjust to more Fed tightening than currently assumed — we see four (or possibly five) Fed rate hikes this year against market expectations for three — and higher bond yields,” he added.
In the currency market, the Japanese yen traded at 110.01 to the dollar, weakening from an earlier high of 109.93. Meanwhile, the Australian dollar traded at $0.7908, dropping from levels above $0.8050 reached in the previous week.
The dollar index, which tracks the greenback against a basket of currencies, traded at 89.263 at 8:13 a.m. HK/SIN after falling below 88.800 in the previous week.
