Asian shares sink taking cue from Wall Street as US Fed chief comments send shares falling

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FILE - This May 11, 2007, file photo shows a Wall Street sign near the flag-draped facade of the New York Stock Exchange. Stronger earnings from several U.S. companies are sending stock prices higher in early trading Wednesday, May 6, 2015. (AP Photo/Richard Drew, File)


TOKYO — Asian markets drooped Thursday after comments from the U.S. Federal Reserve chief fanned fears about the American economy and sent Wall Street lower.


KEEPING SCORE: Japan's benchmark Nikkei 225 slipped 1 percent in morning trading to 19,329.75. It was the first day of trading for the week after the Tokyo market was closed for national holidays. Australia's S&P/ASX 200 lost 0.7 percent to 5,650.00. South Korea's Kospi fell 1.5 percent to 2,073.53. Hong Kong Hang Seng was 0.5 percent lower at 27,503.39 and China's Shanghai Composite Index shed 0.9 percent to 4,190.80.


YELLEN SPEECH: Federal Reserve Chair Janet Yellen suggested that stocks are generally overvalued, when she said market valuations were generally "quite high" in response to a question about risks to financial stability at a conference in Washington. Some market experts think the Fed will have to increase its short-term rate relatively soon to fight inflation.


THE QUOTE: "The highlight was ... Yellen's comments in a Q&A session on equity market valuations being fairly high," said Cynthia Jane Kalasopatan of Mizuho Bank in Singapore. "Fed's Chief Yellen also warned that low US Treasurys yields also mean that there is a risk that they may spike when the Fed normalizes policy later this year."


WALL STREET: The S&P 500 fell 9.31 points, or 0.5 percent, to 2,080.15 on Wednesday. The Dow Jones industrial average dropped 86.22 points, or 0.5 percent, to 17,841.98. The Nasdaq composite declined 19.68 points, or 0.4 percent, to 4,919.64.


ENERGY: U.S. crude was down 65 cents to $60.28 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 53 cents to close at $60.93 a barrel in New York because of an unexpected drop in crude oil supplies and it reached as high as $62.58 during the day. Brent crude dipped 55 cents to $67.22 in London.


CURRENCIES: The dollar rose to 119.60 yen from 119.41 yen in the previous trading session. The euro dropped to $1.1338 from $1.1346.

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