Stocks slide on Beijing lockdown fears, dollar shines as rate hikes loom

Stocks slide on Beijing lockdown fears, dollar shines as rate hikes loom

(Representative image)



Asian stocks had their worst session in a month and a half on Monday as fears grew that Beijing was on the verge of joining Shanghai in lockdowns, while the dollar rose to a two-year high on the prospect of slower growth and higher interest rates.

MSCI's broadest index of Asia-Pacific shares outside Japan slid 2.5% to a six-week low and the Chinese yuan skidded to a one-year trough. Oil fell nearly 4%.

State television in China reported that residents were ordered not to leave Beijing's Chaoyang district on Monday after a few dozen cases were detected over the weekend.

The risk-sensitive Australian dollar fell 1.2% and the euro dropped 0.8% to a two-year low of $1.0707 with Sunday's re-election of Emmanuel Macron as French President offering no obstacle to the dollar's rise.

With war in Ukraine entering a third month and the lockdown of 25 million people in Shanghai about to tip in to its second month, investor sentiment is fragile amid worries that climbs in consumer prices will lead to rapid global rate rises.

S&P 500 futures dropped 0.8% in Asia while FTSE futures and European futures were off by more than 1.5%. Fed funds futures have priced 150 basis