SYDNEY, May 24 — Asian shares slid today as relief at a rally on Wall Street was punctured by a retreat in US stock futures, while the euro held near one-month highs as odds narrowed on a July rate rise from the ECB.
Markets had taken some comfort from US President Joe Biden’s comment yesterday that he was considering easing tariffs on China, and from Beijing’s ongoing promises of stimulus. Unfortunately, China’s zero-Covid policy, with attendant lockdowns, has already done considerable economic damage. Japan’s manufacturing activity grew at the slowest pace in three months in May amid supply bottlenecks, while Toyota 7203.T announced a cut in its output plans. Analysts have also been trimming growth forecasts for the United States given the Federal Reserve seems certain to hike interest rates by a full percentage point over the next two months.