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Tesla (TSLA.O): Teslas humanoid robot continues to iterate, and mass production of Cybercab is accelerating.Shares of Indian airlines fell sharply, with InterGlobe Aviation down 7.5% and SpiceJet down 4.8%.FedEx (FDX.N): Customers may experience service delays due to recent developments in the Middle East.On March 2nd, British Prime Minister Keir Starmer issued a statement on the evening of March 1st, stating that Britain had agreed to allow the United States to use British military bases for "specific and limited" defensive purposes. He stated that Gulf states had requested increased British defense capabilities, and that Britain had deployed fighter jets to the region, successfully intercepting Iranian attacks. Starmer also stated that Britain was not involved in any strikes against Iran. Furthermore, the leaders of Britain, France, and Germany issued a joint statement on the evening of March 1st, indicating that they might take "necessary and proportionate defensive action" against Iran to destroy its ability to launch missiles and drones.On March 2nd, Fitchs research arm, BMI, stated in a report that the temporary surge in oil prices following the US and Israeli attacks on Iran could reduce real GDP growth in several major economies by 0.1 to 0.3 percentage points. Inflation could also rise by 1.0 to 2.5 percentage points. Growth in the Gulf region, due to its proximity to the conflict zone, is likely to be hit hardest. Disruptions to shipping in the Strait of Hormuz will affect trade in both hydrocarbons and non-hydrocarbons, potentially offsetting any increased oil production from OPEC countries. This supply shock could trigger capital outflows from emerging markets, prompting some central banks to prematurely end their easing cycles and raise interest rates.

Asian Shares Fall As Investors Analyze ECB Decisions

Charlie Brooks

Jun 10, 2022 11:14

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Asia-Pacific equities were predominantly lower on Friday morning. Ahead of U.S. inflation statistics, investors are analyzing the European Central Bank's signals for potential interest rate hikes.


At 10:49 PM ET (2:49 AM GMT), the Nikkei 225 was down 1.41 percent, and the KOSPI was down 1.08 percent.


In Australia, the ASX 200 index declined 0.99%.


The Hang Seng Index in Hong Kong fell 0.89 percent.


As a result of the Chinese government's response to a Bloomberg article, the sub-index for Hong Kong-listed IT giants opened 2.9 percent lower. Alibaba (NYSE:BABA) Group Holding Ltd.'s U.S.-listed shares plummeted after the China Securities Regulatory Commission dismissed a Bloomberg report that it was exploring a listing resurrection for the fintech company.


The Shanghai Composite rose 0.10 percent, but the Shenzhen Component rose 0.02 percent.


China's manufacturing factory-gate inflation slowed to its worst pace in 14 months in May, according to previously released data. In May, the producer pricing index (PPI) increased by 6.4% annually, compared to an increase of 8% in April. The reading was the lowest since March 2021. The cooling could be attributable to decreased demand for steel, aluminum, and other industrial commodities as a result of COVID-19-related production disruptions.


Meanwhile, the consumer price index (CPI) increased 2.1% annually.


The European Central Bank (ECB) announced on Thursday that it will prepare a quarter-point increase in interest rates in July and a larger increase in the fall if inflation remains high. Inflation in the eurozone has already surpassed 8 percent.


Short-term U.S. Treasury rates are near all-time highs for 2022 due to a selloff in the euro-area bond market in response to ECB rate rise indications.


The ECB also announced that net asset purchases will halt on July 1, 2022.


Now, investors have moved their attention to U.S. inflation data, due later in the day, for additional hints on the course of interest rate hikes by the U.S. Federal Reserve.


Bloomberg quoted Charles Schwab (NYSE:SCHW) & Co.'s chief financial strategist Liz Ann Sonders as saying, "We've reestablished the inverse relationship between bond rates and stock prices."


"There is a little more discussion, or whispering, about the CPI being a touch above forecasts. Add to that the ECB's more hawkish posture, and you get another bad day."


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