Major Asia-Pacific stocks were down 1.8%. The Shanghai Composite dropped slightly, it fell by 0.56%. The Shenzhen Composite and the Korean KOSPI declined more dramatically, i.e. by 0.95% and 1.05% respectively. Japan's Nikkei 225 lost 1.24% and Australia's S&P/ASX 200 went down 1.52%. Hong Kong's Hang Seng Index is the top loser, it plunged by 1.73%.
Today, the US Federal Reserve will announce a decision on the next steps of the monetary policy in the country. All investors are awaiting the meeting's outcome. Over 80% of experts believe the interest rate will be raised by 0.75%, while other analysts assume it will be increased by 1% immediately. The day before, the US stock indexes also declined.
The Asian Development Bank downgraded the forecast for 2022-2023 in developing Asia and the Pacific due to increased international risks. The forecast on GDP growth was lowered from 5.2% in April to 4.3% and from 5.3% to 4.9% in 2022 and 2023 respectively. Analysts believe that a significant decline in global economic growth has a negative impact on Asia-Pacific exports. Moreover, tighter than previously expected monetary policy measures may have a negative effect on financial stability.
China's economy continues to suffer from new coronavirus outbreaks, entailing the introduction of restrictive measures, as well as the crisis situation in the real estate market.
Among the components of Hong Kong's Hang Seng Index, shares of Xinyi Solar Holdings, Sunny Optical Technology Group, Geely and BYD, Netease and Alibaba Group as well as JD.com suffered their biggest decline. They were down 7.6%, 5.8%, 3.5%, 2.3%, 3.3% and 2.4% respectively.
As for Japanese companies, shares of Unitika were the top losers. They plunged by 6.5%. Stocks of other major companies dropped slightly: Nissan Motor and Toyota Motor lost 2.9% and 2.3% respectively, SoftBank Group and Nintendo fell by 1.1% each.
The components of the Korean KOSPI showed mixed trading. The shares of Hwacheon Machinery Co. jumped by 30% after a major decline the day before. At the same time, quotes of other companies declined slightly: the shares of Samsung Electronics and Hyundai Motor fell by 0.9% and 1.3% respectively.
Shares of the largest Australian companies also declined. Moreover, stocks of BHP dropped by 3% and shares of Rio Tinto were down 3.2%. Stocks of Woodside Energy and Santos lost 1.9% and 1% respectively.