Investing.com - Asian-Pacific markets opened on a somber note this Wednesday, echoing the significant fall of U.S. stocks overnight due to revived inflation apprehensions.
Australia's S&P/ASX 200 experienced a dip of 1.2%, while Japan's Nikkei 225 index also declined by 0.7%. In contrast, South Korea's KOSPI 200 index remained closed due to a public holiday.
During Tuesday's US session, the S&P 500 fell 1.6% the NASDAQ Composite index shed 2% and the Dow Jones Industrial Average index slumped 1.5%.
Every sector within the S&P 500 concluded the day in the red. The broad index saw a 4.2% slump in April, marking its worst performance since September, following its best first-quarter performance since 2019. Over the month, the Nasdaq and Dow fell by 4.4% and 5%, respectively.
Data revealed on Tuesday suggested that the Federal Reserve's battle against inflation is far from over. The Labor Department's employment-cost index rose by a seasonally adjusted 1.2% in the first quarter from the prior three months, and 4.2% from a year earlier.
This recent data indicates that inflation continues to exceed the central bank's comfort level. For three straight months, consumer prices have risen more than Wall Street had projected.
This ongoing trend has quelled Wall Street's expectations for imminent interest-rate cuts. While investors started the year anticipating as many as six cuts in 2024, many now question whether there will be any cuts at all.
Federal Reserve officials are anticipated to maintain their benchmark federal-funds rate steady at its highest level in over two decades at their policy meeting, which concludes on Wednesday. On Friday, April's jobs data will provide a refreshed view of the labor market's condition.
The benchmark 10-year Treasury yield settled at 4.683% on Tuesday, up from 4.612% on Monday. This marked the largest monthly increase in yields since September 2022. In local bond markets, the yield on Australian 2 Year government bonds was down at 4.09%, while the 10 Year yield also decreased to 4.42%.
Despite the prevailing gloom, the earnings season has offered some respite. S&P 500 companies have seen first-quarter earnings growth of 3.9%, according to FactSet, when blending actual results with analysts' forecasts. As of Tuesday morning, about 53% of companies within the index had reported results.
Amazon.com Inc (NASDAQ:AMZN), the latest of the Magnificent Seven tech stocks to report, announced profits surpassing expectations after markets closed on Tuesday. Apple (NASDAQ:AAPL)'s results are awaited on Thursday afternoon.
Eli Lilly and Company (NYSE:LLY) experienced a 6% rise after the manufacturer of popular weight-loss drugs raised its full-year profit outlook. 3M (NYSE:MMM) ascended by 4.7% after announcing plans to discontinue its quarterly dividend.
GE HealthCare Technologies Inc (NASDAQ:GEHC) saw a 14% fall after earnings, marking its worst single-day performance since its stock-market debut in 2022.
In commodity markets, Brent Oil fell by 0.6% to US$87.86 a barrel, while gold declined 2.1% at US$2,286.25.