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Live news: Asia-Pacific markets reverse gains to fall on rate rise fears

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US stocks resumed their surf on Wednesday after unexpectedly hot “core” inflation data raised expectations for aggressive policy tightening, pushing the high-tech Nasdaq Composite down nearly 30% from its peak.

Growth stocks that are considered particularly sensitive to price gains led the declines, with the Nasdaq down 3.2%. The blue S&P 500 index, which rose 1.2% earlier during trading, ended the day down 1.6%.

Consumer prices in the world’s largest economy have risen at an annual rate of 8.3 percent In April, down 8.5 percent in March, but remained at a historically high level. The figure exceeded economists’ expectations for cooling to 8.1%. The month-on-month change in core inflation – which does not include food and energy prices and is closely watched by economists – also exceeded forecasts by 0.6%.

Rising costs of new cars, food, air fares and housing have been the biggest drivers of rising consumer prices, the U.S. Department of Labor said.

As consumer prices soared, traders expected the Fed to raise interest rates aggressively for the rest of the current year, putting US government debt under short-term pressure.

The yield on the two-year Treasury bill, particularly sensitive to monetary policy, rose by 0.03 percentage points to 2.64 percent, from below 0.2 percent a year ago. Yields rise as prices fall.

In contrast, the 10-year Treasury yield, driven by long-term economic trends, fell by 0.06 percentage points to 2.93%.

Read more about today’s market moves Here.

Live news: Asia-Pacific markets reverse gains to fall on rate rise fears Source link Live news: Asia-Pacific markets reverse gains to fall on rate rise fears

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