Asian Shares Decline On Rate Hike, Growth Fears

(RTTNews) - Asian stocks drifted lower on Friday as a spate of rate hikes from policymakers in England, Norway and Switzerland pushed up global bond yields and revived fears of an imminent recession.

The dollar continued to benefit from risk aversion on concerns that higher interest rates could slow economic growth. Both oil and gold headed for weakly losses on fears of further rate hikes.

Mainland Chinese markets were closed for a public holiday. Hong Kong's Hang Seng index plummeted 1.71 percent to close at 18,889.97 in catch-up traded as trading resumed after a holiday on Thursday.

Japanese stocks fell sharply as the latest inflation data stoked speculation the Bank of Japan could tweak its yield control policy as soon as in July.

Japan's core inflation rate in May eased slightly to 3.2 percent year-on-year, down from 3.4 percent in April but still above the central bank's target, data showed.

The Nikkei average slumped 1.45 percent to 32,781.54 while the broader Topix index ended 1.38 percent lower at 2,264.73.

Uniqlo clothing chain Fast Retailing and technology investor Softbank Group both fell around 2.4 percent.

Marubeni lost 3.4 percent and Itochu plunged 4 percent on profit taking after recent strong gains on news of Warren Buffett's Berkshire Hathaway Inc. raising its stakes in Japan's five leading trading houses.

Seoul stocks turned lower after the country failed to win developed market status on the global stock indices provided by Morgan Stanley. The Kospi average ended 0.91 percent lower at 2,570.10, with chemical and auto stocks leading losses.

Australian markets fell for a third straight session on fears of major economies falling into recession. Investors were also spooked by data revealing a slowdown in Australian manufacturing and services activities.

The benchmark S&P/ASX 200 ended down 1.34 percent at 7,099.20, with energy and financial stocks pacing the declines. The broader All Ordinaries index settled 1.29 percent lower at 7,285.60.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index finished marginally lower at 11,737.55.

U.S. stocks ended mostly higher overnight despite policy tightening fears from the U.S. to Norway and the U.K.

Tech stocks led advances as Fed Chair Jerome Powell wrapped up his congressional testimony, saying the central bank would move interest rates at a "careful pace" from here.

In economic releases, new data showed the number of jobless claims remained elevated last week.

The Dow ended flat with a negative bias, while the S&P 500 gained 0.4 percent and the tech-heavy Nasdaq Composite added 1 percent to snap three-day losing streaks.