Asian shares fell on Tuesday as investors dumped high-flying U.S. technology shares on fears of stiffer regulation as Facebook came under fire following reports it allowed improper access to user data.
The retreat came as investors braced for new Federal Reserve Chairman Jerome Powell`s first policy meeting starting later in the day and amid concerns that U.S. President Donald Trump could impose additional protectionist trade measures.
MSCI`s broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> dropped 0.2 percent. Japan`s Nikkei <.n225> fell 1.0 percent.
On Wall Street the S&P 500 <.spx> lost 1.42 percent and the Nasdaq Composite <.ixic> 1.84 percent, both suffering their worst day in five weeks.
"Investors lightened their positions ahead of the Fed`s policy meeting. The markets are completely split on whether the Fed will project three rate hikes this year or four," said Hiroaki Mino, senior strategist at Mizuho Securities.
In addition, worries about the potential for a U.S.-China trade war cast a shadow after U.S. President Trump imposed tariffs on steel and aluminium and suggested punitive tariffs on some $60 billion worth of Chinese information technology, telecoms and consumer products annually.
The sharp fall in share prices put a lid on long-term U.S. bond yields while short-dated yields rose ahead of an expected rate hike from the U.S. Federal Reserve after its two-day policy meeting starting on Tuesday.
The yield on 10-year Treasuries was 2.845 percent
But the yield on two-year notes
But with a Fed rate rise already fully priced in, the dollar barely gained from the prospect of a rate hike. Instead it was the euro that stole the spotlight after Reuters reported that European Central Bank officials were shifting their debate from bond purchases to the expected path of interest rates.
The British pound
It was last at $1.4024.
The yen was little changed at 106.01 per dollar
Oil prices barely moved as investors remained wary of growing crude supply although tensions between Saudi Arabia and Iran provided some support.
Brent crude futures
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)