Following a dip in U.S. banks, Asian markets declined on Wednesday, echoing actions on Wall Street.
JPMorgan Chase, Wells Fargo, and Bank of America all saw share prices fall by 2% and 3%, respectively. The action was taken after Fitch issued a warning that it might need to reduce the credit ratings of other institutions, including JPMorgan Chase.
Ten American banks had their ratings downgraded by Moody’s last week, and additional significant institutions were placed on notice for similar action.
Despite business optimism increasing in July, according to the Reuters Tankan survey, Japan’s Nikkei 225 and the Topix fell in Asia by 1.03% and 0.9%, respectively.
The Kosdaq suffered a bigger loss of 1.71% while the Kospi in South Korea returned from a holiday down 1.28%.
The S&P/ASX 200 fell 1.37% in Australia, putting it on pace to post losses for a third straight day.
The Hang Seng index in Hong Kong dropped 1.05%. While the CSI 300 index was down by 0.35%, mainland Chinese markets were also down. With a 0.1% year-over-year decline, China’s house price index entered contraction zone for the first time since April.
All three main U.S. indexes declined throughout the previous night, with the S&P 500 losing 1.16% and finishing the session below its 50-day moving average. The Dow Jones Industrial Average dropped 1.02% and ended a three-day winning streak, while the Nasdaq Composite dropped 1.14%.