Asian shares fell after US jobs data cheered fears of a rate hike

Asian stock markets fell on Monday after strong US jobs data stoked fears of further interest rate hikes to cool inflation.

Shanghai, Hong Kong and Seoul retreated. Tokyo received. Oil prices rose.

Wall Street fell on Friday after official data showed that US employers hired twice as many people in January as in the previous month. That was good news for workers, but dampened hopes that the Federal Reserve might decide it no longer needs to raise rates to slow economic activity.

“These numbers seem inevitable to burst the Fed’s key rate bubble” because they “suggest re-acceleration of wage pressures,” Mizuho Bank’s Tan Boon Heng said in a report.

The Shanghai Composite fell 0.8% to 3,237.36, while Tokyo’s Nikkei 225 rose 0.6% to 27,671.02. Hong Kong’s Hang Seng fell 2% to 21,230.81.

Seoul’s Kospi fell 1.1% to 2,452.55, while Sydney’s S&P-ASX 200 retreated 0.3% to 7,539.00.

India’s Sensex opened down 0.6% at 60,472.35. Southeast Asian markets declined. New Zealand markets are closed for the holiday.

On Wall Street, the benchmark S&P 500 fell 1% to 4,136.48 on Friday after the government said the economy added 517,000 jobs in January. That was double December’s 260,000 and more than double the 185,000 expected by economists.

Despite this, the S&P 500 posted its fourth weekly gain in the past five. This is 15.6% above the low point in October.

The average hourly wage in January was 4.4% higher than a year earlier. That was lower than December’s 4.8% increase, but above expectations. Central bankers worry that rising wages could push up consumer prices.

The data dampened investors’ hopes that lower inflation could persuade the Fed and other central banks to ease plans for further rate hikes. They worry that central bankers may want to tip the global economy into recession to stem inflation, which is near multi-decade highs.

Some traders expect the Fed to cut rates later this year, despite officials warning that more increases are on the way. Representatives of the European Central Bank issued similar warnings.

The Dow Jones industrial average fell 0.4% to 33,926.01. The Nasdaq Composite fell 1.6% to 12,006.96.

Also on Friday, a separate report showed that the US services sector returned to growth in January. This was a stronger reading than expected, but suggests that price pressure may ease.

In energy markets, benchmark US crude rose 23 cents to $73.62 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $2.49 to $73.39 on Friday. Brent oil, the price basis for international oil trading, rose 34 cents to $80.28 per barrel in London. It lost $2.23 in the previous session to $79.94.

The dollar rose to 131.70 yen from 131.07 yen on Friday. The euro fell to $1.0796 from $1.0805.