STI down 0.6% as Asian equities slide on hawkish Fed comments

SINGAPORE stocks slumped, as did other Asian equities, on Wednesday (Apr 6), as investors grappled with the possibility of aggressive monetary tightening by the US Federal Reserve while awaiting greater clarity on sanctions to be imposed on Russia.

The benchmark Straits Times Index (STI) fell 0.6 per cent or 22.06 points to 3,422.95. Major indexes in Hong Kong, Japan, South Korea and Australia closed down 1.9 per cent, 1.6 per cent, 0.9 per cent and 0.5 per cent respectively.

IG market strategist Yeap Jun Rong said the markets were reacting to comments of Fed governor Lael Brainard, which were perceived to carry a hawkish tone. Brainard had mentioned that the US central bank could start to reduce its balance sheet as soon as May and would be doing it "considerably more rapidly" than in the previous recovery.