Asian shares slide after tech, high oil prices drag Wall St lower

An employee of a bank walks by the screens showing the Korea Composite Stock Price Index (Kospi), left, and the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Wednesday, Sept. 13, 2023.  (AP Photo/Lee Jin-man)

Stocks fell Wednesday in Asia after a slide in technology stocks dragged Wall Street lower ahead of a key report on U.S. inflation.

Hong Kong’s Hang Seng lost 0.2 percent to 17,986,56 and the Shanghai Composite index sank 0.8 percent to 3,113.18.

Japan’s Nikkei 225 index shed 0.2 percent to 32,706.52, while the Kospi in Seoul edged 0.1 percent lower, to 2,533.61. Australia’s S&P/ASX 200 gave up 0.7 percent to 7,154.60.

Shares rose in India and Taiwan but fell in Southeast Asia.

Regional markets have been relatively quiet ahead of this week’s release of Chinese and U.S. economic data.

Wednesday will bring the latest monthly update on prices that U.S. consumers are paying across the country. Economists expect it to show that prices were broadly 3.6 percent higher last month than a year earlier.

Thursday will bring reports about inflation at the wholesale level and sales at U.S. retailers. Strong spending by U.S. households has helped keep the U.S. economy humming, but it could also be encouraging companies to keep trying to raise their prices further.

Stocks have been see-sawing in recent weeks amid the revived uncertainty about whether the Federal Reserve is done with its avalanche of hikes to interest rates. The central bank has already pushed its main interest rate to the highest level in more than two decades, trying to get inflation back down to its target of 2 percent.

High interest rates work to undercut inflation by slowing an entire economy and knocking down prices for stocks and other investments.

Inflation has subsided from a peak of more than 9 percent last year, but a recent surge in oil prices has undermined that process and could compel the Federal Reserve to act again to tame inflation, Stephen Innes of SPI Asset Management said in a commentary.

“This scenario underscores the delicate balance between energy costs, inflationary pressures, and the central bank’s monetary policy actions, which can have profound implications for the broader economic landscape,” he said.

Still, traders overwhelmingly expect next week’s meeting for the Federal Reserve to end with interest rates staying where they are.

On Tuesday, the S&P 500 lost 0.6 percent to 4,461.90. The Dow Jones Industrial Average slipped 0.1 percent, to 34,645.99 The Nasdaq composite dropped 1 percent to 13,773.61..

Tech stocks tumbled

Software giant Oracle helped lead the losses for tech stocks after reporting its revenue for the latest quarter fell just short of what analysts expected. Its stock tumbled 13.5 percent, even though its profit topped expectations. Oracle’s forecast for how much revenue it will make in the current quarter also wasn’t as strong as some analysts expected.

Apple dropped 1.8 percent after it unveiled the latest models of its phones and other devices. The stock had soared through much of this year, which is crucial for many investors because it has more sway than other stocks on the S&P 500 as Wall Street’s most valuable company. But it’s been struggling since the end of July and has reported three straight quarters where its revenue fell from year-earlier levels.

Alphabet, meanwhile, fell 1.2 percent as an antitrust trial against Google opened in a federal courthouse. It’s the biggest such trial since regulators took Microsoft to court in 1998. The U.S. government is accusing Google of abusing its position as the world’s dominant search engine and forcing consumers to settle for inferior search results.

In other trading Wednesday, U.S. benchmark crude was up 21 cents at $89.05 a barrel in electronic trading on the New York Mercantile Exchange. It jumped $1.55 on Tuesday.

Brent crude oil, the international pricing standard, picked up 15 cents to $92.21 a barrel.

The U.S. dollar rose to 147.28 Japanese yen from 147.08 yen late Tuesday. The euro slipped to $1.0739 from $1.0755.