Asia markets sink after Wall Street's worst losses since Trump election
KAZUHIRO NOGI (AFP/File)
Asian markets tumbled Wednesday, tracking a US and European sell-off as a surge in equities went into reverse.
The dollar also struggled to recover against its major rivals and suffered fresh losses against high-yielding units.
After hitting multiple records this month, Wall Street's main indexes suffered their worst losses since Donald Trump's win, dragging Europe with them, as dealers fret about his agenda.
The key cause for concern is Thursday's vote in Congress on the replacement for Obamacare, with many Republicans opposed to it in its current form.
Analysts say the inexperienced Trump is spending too much capital on the issue and if he is unable to push it through a Republican-controlled Capitol Hill, then his other plans -- particularly infrastructure spending, tax cuts and deregulation -- could be in trouble. Such promises were a key factor in the global markets rally.
The president traveled up Pennsylvania Avenue Tuesday to warn the party is could lose its majority if it fails to push through his bill.
"There is an ugly sea of red across global markets this morning as traders finally succumb to their fears that the positive benefits of Trumponomics are going to be delayed," Greg McKenna, chief market strategist at AxiTrader, said in a note.
"The impact of this is that the tax and infrastructure policy and implementation the market has been aching for looks set to be delayed. This is a sign that investors are losing faith in Trumponomics."
Tokyo ended the morning two percent lower as the dollar sank to its lowest level against the yen since November, while Hong Kong shed one percent and Shanghai gave up 0.2 percent.
Sydney was 1.5 percent lower, Singapore shed one percent and Seoul slipped 0.6 percent. Wellington, Taipei, Manila and Jakarta also suffered hefty losses.
With expectations for economy-friendly measures petering, the dollar has taken a severe hit. It extended Tuesday's losses against the yen but held its ground against the pound and euro.
However, the South Korean won jumped 0.5 percent, Australia's dollar rallied one percent and the Indonesian rupiah was 0.2 percent higher. The Mexican peso, which after Trump's win hit regular record lows, was also one percent higher.
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