ASIA STOCKS SKID, APE WALL STREET TUMBLE

Asian stocks skidded on Thursday, January 28, 2021, following a sharp Wall Street decline amid deepening concerns about stretched valuations in equities markets, while the dollar and bonds strengthened, Alwyn Scott reported for Reuters.

In early Asian trade, Australia’s S&P/ASX 200 benchmark lost 1.99%, Japan’s Nikkei fell 2.28% and Hong Kong’s Hang Seng index futures lost 0.51%. S&P futures pulled back 1%.

Adding to the market worries was the outcome of Federal Reserve’s policy meeting. While the Fed kept settings unchanged as expected, policymakers flagged a concerning slowdown in the pace of the economic recovery.

Michael McCarthy, chief market strategist at CMC Markets in Sydney, said the wider stock selloff was surprising, given strong fourth-quarter results from tech giants.

“A little bit of a sell-the-fact response,” McCarthy said, noting stock valuations are at toppy levels.

“It might not have everything to do with the Fed.” Noting there was no urgency in dollar or bond-buying, he said: “Maybe what we need is a good old-fashioned panic” to cool valuations.

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