Home Business Stocks, oil drop, dollar gains amid recession fears

Stocks, oil drop, dollar gains amid recession fears


Equities and crude prices fell, while the dollar held at multi-year highs Wednesday as recession fears mount, while traders are also growing increasingly concerned about tensions with Russia after it declared victory in controversial Ukraine annexation polls.

Investors are also keeping a close eye on London, after new finance minister Kwasi Kwarteng’s tax-cutting mini-budget last week sent shock waves through markets, pushing the pound to a record low and leading to dire warnings for Britain’s economy.

While Asia saw small gains Tuesday, New York and Europe ended mostly in the red again, with Wall Street jolted by data showing a surprise improvement in US consumer confidence — likely because of a dip in petrol prices — and a jump in home sales.

The figures pointed to resilience in the world’s top economy despite three successive bumper Federal Reserve rate hikes — and expectations for another in November — as it tries to tame four-decade-high inflation.

Several Fed officials have lined up this week to reassert their determination to keep hiking until prices are brought under control, even at the cost of a recession.

Observers are now betting that borrowing costs will top out at around 4.75 percent next year, and some policymakers have suggested they could remain elevated for some time.

The prospect of such tight monetary policy has battered equities, as US 10-year Treasury yields — a gauge of future rates — hit four percent for the first time since 2010.

The Dow and S&P 500 ended down Tuesday, though the Nasdaq enjoyed a slight uptick.

Asia resumed its downtrend Wednesday, with Hong Kong down more than three percent, while Seoul, Taipei and Manila sank more than two percent. Tokyo, Shanghai, Singapore were off more than one percent.

There were also losses in Sydney, Wellington and Mumbai.

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