Asian stocks lower after Wall Street slump

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Asian stocks lower after Wall Street slump

Asian stock futures were lower after Wall Street closed lower as investors looked beyond the debt ceiling to concentrate on the path for interest rates and concerns in earnings reports.

Contracts for benchmarks in Japan, Hong Kong and Australia all slid, adding pressure to the region's equities, which fell more than 1% Wednesday against the backdrop of worries about Chinese growth. China's manufacturing data for Monday is forecast to show a further contraction in activity.

Contracts for US equities were flat in early Asian trading on Wednesday after declines on Wednesday. The S&P 500 closed lower, trailing 0.6% lower, narrowly clinging to a small gain for May to mark three consecutive monthly gains. In the Nasdaq 100 index, the Nasdaq 100 index fell 0.7%, weighed down by a drop in Nvidia Corp. shares after a quick rally that has tripled the stock price this year.

Australian and New Zealand bond yields fell, following a drop in Treasury yields and a rally in the dollar.

The move followed comments from Federal Reserve Governor Philip Jefferson, who signaled the central bank is inclined to keep interest rates steady in June to assess the economic outlook. He echoed Philadelphia Fed President Patrick Harker, who said he thinks we can take a bit of a skip for a meeting. Hopes for a Fed pause were partly pared back after the JOLTS jobs report for April showed more than 10 million openings, the highest in three months and above consensus estimates.

Investors also watched the latest developments in the US debt-ceiling saga. The deal reached by House Speaker Kevin McCarthy and President Joe Biden marked a significant hurdle in the House, lining the amendment's passage as the U.S. rapidly approaches a June 5 deadline to avert a default.

Those planning for a relief rally following the passage of the debt ceiling increase may be disappointed, said Mark Hackett, chief of investment research at Nationwide. Investor confidence and data quality will be critical for the next move higher for equities. corporate earnings were again in focus. Salesforce shares fell by about 7% in after-hours trading following a dim outlook for sales while Hewlett Packard Enterprise Co. fell 7.1% Wednesday on slimmer revenue projections than anticipated.

West Texas Intermediate crude, which is a tad higher than $70 a barrel, dipped below $70 a barrel. ICE Brent futures also fell on the London Stock Exchange.

One of the main moves in markets: None The British pound was little changed at $1.2448.

The story was produced through the assistance of Bloomberg Automation.