March 25 (UPI) -- Asian stock markets plummeted Monday, stoking fears that an economic slowdown could be on the horizon or at the least, the U.S. Federal Reserve will stop raising interest rates.
The MSCI Asia-ex Japan index fell 1.65 percent to 521.00 while the Nikkei 225 plunged 3.01 percent to close at 20,977.11. The downturn was led by Softbank Group and Fanuc, who fell 5.01 percent and 3.84 percent, respectively.
In China, the Shanghai composite fell 1.97 percent and the Shenzhen component declined 1.8 percent. The news is similar in Hong Kong, South Korea, Thailand and Australia.
Thailand performed better than its Asian peers, with its SET Index losing only 1.3 percent. This comes as the country has its first general election since 2014. The pro-military party is leading and will likely retain power.
"We believe local investors will likely cheer at the prospects of continuity and deliver a bounce lasting possibly several weeks," Credit Suisse Group AG analysts,including Dan Fineman wrote in a note. "We note, however, that the next government will be a weak and possibly unstable coalition and that the market is fairly expensive."
The market declines in Asia were triggered by market U.S. market losses on Friday, disappointing economic news from Europe and a downgraded outlook from the U.S. Federal Reserve.
"At this stage, we are not predicting a U.S. recession, but we have already concluded and published that the Fed's tightening cycle is finished," strategists at the Commonwealth Bank of Australia said.
The news comes as U.S officials head to Beijing to continue trade talks with China. A deal, which would end the tit-for-tat tariff war going on now, is expected in April.