Asian stocks drop after Fed’s hawkish stance

The Asian equity markets tracked their Wall Street counterpart lower on Thursday, after the Fed hiked rates by 25bps for the first time this year and signaled faster pace of tightening in the year ahead, sending the greenback rallying across the board.

The Fed’s hawkish guidance also boosted the US treasury yields, weighing negatively on the alternative higher-yielding assets such as the equities.

While hints of acceleration in the rate hikes in an unexpected move by the Fed, hit the sentiment around the corporate world on the back of prospects of higher borrowing costs and withdrawal of capital from export-dependent Asia-Pac economies.

Further, the yen’s rebound so far this session also hit the exporters’ stocks and dragged the Japanese indices lower.

Meanwhile, Japan’s Nikkei 225 trades -0.18% lower at 19,220, the Australian S&P/ASX 200 drops -0.85% to 5,540. The Chinese equities keep the red zone, with the benchmark Shanghai Composite index dropping -0.29%, while CSI300 index also declines -0.53%. Hong Kong markets tanks -1.82% to 22,060 levels.