- Stocks, Dollar Jolted by Missile Strike in Poland
- Asian equities decline, US and European share futures fall
Stocks and currencies whipsawed on Wednesday after a rocket that struck inside the Polish border fueled fears of an escalation of the war in Ukraine.
Shares in Hong Kong, Australia and South Korea fell, as did US and European equity futures, amid significant volatility in intraday prices.
Positive sentiment from the outlook for slower interest rate hikes from the Federal Reserve evaporated as traders in Asia turned their attention to geopolitical risks. Comments from US President Joe Biden — suggesting the missile was unlikely to have been fired from Russia — had only a temporary impact on investor confidence.
The Polish zloty trimmed its losses against the dollar while a broad gauge of the greenback returned to its high point for the day as traders sought security.
Treasury yields saw small gains after recent declines in line with pricing for the Fed’s policy rate. Oil and gold both slipped.
“After a strong rebound in US equities and in the Chinese equity markets, I think it makes sense to have some consolidation,” Grace Tam, chief investment adviser for Hong Kong at BNP Paribas Wealth Management, said on Bloomberg Television. “With what happened in terms of the missile, it could be the trigger of the consolidation. Sentiment has gone from risk-on to a little bit risk-off.”