Asia shares slide across board amid rate hike, COVID worries

Asian shares declined Thursday, echoing a retreat on Wall Street as investors fretted about higher interest rates and rising coronavirus cases in parts of the region.

Benchmarks fell in Tokyo, Shanghai, Hong Kong, Seoul and Sydney. Oil prices fell by more than $2 a barrel.

In China, strict COVID-19 restrictions are back in Hong Kong as infections rise, while they are gradually being lifted in Shanghai. China has stuck to a “zero-COVID” strategy that requires lockdowns, mass testing and isolation for those infected or who has been in contact with someone testing positive.

Japan’s benchmark Nikkei 225 lost 0.3% to 27,367.82. Australia’s S&P/ASX 200 edged down 0.9% to 7,172.80. South Korea’s Kospi slipped 1.1% to 2,656.19. Hong Kong’s Hang Seng dipped 1.5% to 20,982.29, while the Shanghai Composite shed 0.3% to 3,172.66.

On Wall Street, stocks began their slide immediately after the release of several reports on the U.S. economy, including one showing manufacturing growth was stronger last month than expected. That bolstered investors’ expectations for the Federal Reserve to continue raising interest rates aggressively to slow the economy in hopes of reining in inflation.

The S&P 500 fell 0.7% to 4,101.23. The Dow Jones Industrial Average gave up 0.5% to 32,813.23.

The Nasdaq composite slid 0.7% to 11,994.46. Smaller company stocks also lost ground. The Russell 2000 index dropped 0.5% to 1,854.82.