GLOBAL MARKETS 
DJIA         34033.67  -265.66  -0.77% 
Nasdaq       14039.68   -33.17  -0.24% 
S&P 500       4223.70   -22.89  -0.54% 
FTSE 100      7184.95    12.47   0.17% 
Nikkei Stock 28940.47  -350.54  -1.20% 
Hang Seng    28452.06    15.22   0.05% 
Kospi         3261.57   -17.11  -0.52% 
SGX Nifty*   15682.00   -93.5   -0.59% 
*June contract 
 
USD/JPY 110.64-65    -0.06% 
Range   110.82   110.61 
EUR/USD 1.2001-04    +0.05% 
Range   1.2006   1.1984 
 
CBOT Wheat July $6.626 per bushel 
Spot Gold      $1,820.33   0.5% 
Nymex Crude (NY)  $71.86  -$0.26 
 
 
U.S. STOCKS

Stocks fell after Federal Reserve officials indicated they expected higher interest rates by late 2023, sooner than previously projected.

The Dow Jones Industrial Average fell 265.66 points, or 0.8%, to 34033.67, while the S&P edged down 22.89 points, or 0.5%, at the closing bell. The Nasdaq Composite lost 33.17 points, or 0.2%. Before the Fed's statement, stocks had hugged the flat line for much of the day. 


 
 
ASIAN STOCKS

Japan's Nikkei Stock Average was 0.8% lower at 29044.18 in early trade, in line with U.S. stocks which fell overnight after the U.S. Fed signaled a rate increase by late 2023. Precision instruments were lower, with medical-device maker Terumo Corp. off 0.7%, Olympus Corp. down 0.8% and optical-products maker Hoya Corp. declining 1.3%. Aviation stocks were also lower, with Japan Airlines down 2.9% and ANA Holdings Inc. slipping 2.5%. Among pharmaceutical stocks, Kyowa Kirin Co. was off 0.5%, Takeda Pharmaceutical Co. declined 0.7% and Hisamitsu Pharmaceutical fell 1.5%. Toshiba Corp. gained 1.3% after its board chairman Osamu Nagayama, told the WSJ that he would consider handing over the reins after revamping the board and installing a new CEO.

South Korea's Kospi was 0.8% lower at 3253.22 in early trading after the U.S. Federal Reserve signaled a rate increase by late 2023, which was sooner than Fed officials had previously anticipated. The Fed's stance sent USD/KRW more than 1.0% higher, weakening investor appetite for riskier assets such as equities. The pair was trading at 1,129.80 versus 1,117.20 late Wednesday. Retail and technology stocks were leading the losses. Retailers Shinsegae and Lotte Shopping fell 2.8% and 1.6%, respectively. Memory-chip maker SK Hynix slid 2.7%. But battery maker LG Chem gained 3.2%. Index heavyweight Samsung Electronics lost 1.2%.

Hong Kong stocks edged down in morning trade, following losses in U.S. equities overnight after the Fed's latest comments came out more hawkish than expected. The benchmark Hang Seng Index shed 7.83 points to 28429.01, extending two consecutive days of decline. KGI Securities expected the market to remain under pressure in the near term, given the Fed's projection it could raise interest rates in 2023, as well as weak May economic data from China. The brokerage put the HSI's support level at 28000.

Chinese stocks were higher in early trade, showing signs of recovery after a broad downturn earlier this week. The benchmark Shanghai Composite Index gained 0.4% to 3530.85, while the Shenzhen Composite Index was up 1.1% at 2357.70. The ChiNext Price Index, a measure for emerging industries and startups, rose 2.1% to 3191.58. China Fortune Securities reckoned the uptrend could mark the beginning of an overall rebound in the market from now. While the Fed's latest hawkish remarks would add pressure, the brokerage reckoned the negative news could be priced in soon and the Chinese market may start to bottom out. 


FOREX

Some Asian currencies weakened against the dollar after the Fed signaled earlier-than-expected rate increases in its "dot plot" at the FOMC meeting overnight. The dot plot indicated that the median FOMC member forecast was for two Fed rate increases in 2023, versus none at the March iteration, delivering a hawkish surprise on which most of the subsequent market reaction has turned, NAB said. USD/JPY edged 0.1% higher to 110.74, USD/MYR climbed 0.5% to 4.1375, while AUD/USD was little changed at 0.7611 and USD/SGD was steady at 1.3360. 


METALS

Gold rebounded in a likely technical upward correction after falling overnight due to a stronger USD and higher Treasury yields spurred by a hawkish Fed outlook. While the FOMC stuck to its view that the increase in inflation is mostly "transitory," the FOMC now expected to raise the funds rate twice in 2023, CBA said. Previously, the FOMC didn't expect to increase the funds rate until after 2023, CBA added. Spot gold was recently up 0.5% at $1,820.33/oz. 


OIL SUMMARY

Oil declined in early Asian trade, after the U.S. Fed signaled a rate increase by late 2023. The "surprisingly hawkish" stance sent both U.S. Treasury yields and the U.S. dollar higher, Oanda said. A short-term rebound in USD may pose a downside risk to WTI crude for now, it said. Front-month WTI crude-oil futures and front-month Brent crude oil were each 0.9% lower at $71.54/bbl and $73.76/bbl, respectively. 


 
 
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(END) Dow Jones Newswires

06-16-21 2315ET