Asian equities tumbled Friday following a rout on Wall Street fuelled by worries over rising interest rates and surging inflation, while the pound extended losses the day after taking a beating on fears of a UK recession.

Global markets have been battered this year by a series of crises including surging inflation, rising interest rates, China's economic slowdown and the war in Ukraine.

There was some relief after the Federal Reserve on Wednesday lifted borrowing costs 50 basis points -- the most since 2000 -- but suggested a feared 75-point lift was not on the agenda for now.

However, US traders ran for the hills Thursday as they contemplated a period of fierce monetary tightening by the US central bank as it struggles to contain inflation running at a more than 40-year high.

The Nasdaq -- dominated by tech firms particularly sensitive to higher rates -- lost five percent, while the Dow and S&P 500 fell more than three percent.

"Valuations become even more sensitive, very sensitive, when rates are going up and that is what we are experiencing," Kristina Hooper, at Invesco, told Bloomberg Television.

"It's just getting exacerbated as we get into the thick of monetary-policy tightening in the US."

That sell-off filtered through to Asia, where Hong Kong tanked more than three percent as tech firms took a hit. Meanwhile, the European Chamber of Commerce in the city called the finance hub's stringent pandemic travel restrictions and frequent flight bans a "nightmare" for businesses.

The remarks come a week after the Australian Chamber of Commerce recommended that Hong Kong follow the lead of Singapore or Japan by lowering quarantine requirements for business travellers.

Shanghai, Sydney, Seoul, Singapore, Wellington, Taipei and Manila also tanked. However, Tokyo ended the morning slightly higher.

Adding to the selling pressure was ongoing weakness in China's economy caused by strict lockdowns and other containment measures as officials struggle to bring a Covid flare-up under control by sticking to a zero-Covid policy.

Various districts in Beijing told residents on Thursday to work from home, while Shanghai, the biggest city in the country, remains essentially shut down.

On currency markets the pound continued to struggle a day after plunging more than two percent in reaction to the Bank of England's updated forecast that warned annual inflation would top 10 percent and the economy would contract later this year.

Crude rose after key oil producers led by Saudi Arabia and Russia refused to lift output more than their planned marginal increase as they weighed tight supply concerns caused by the Ukraine war.

"OPEC's inability to ramp up production when desperately needed by the market is compounding an already dangerous supply deficit," said Stephen Innes, of SPI Asset Management

"This means geopolitical tensions will remain high, and while there are some demand-side risks at the moment, it seems likely that the threat of supply disruption will be the dominant driver at this time," he said.

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: UP 0.1 percent at 26,850.53 (break)

Hong Kong - Hang Seng Index: DOWN 3.3 percent at 20,102.87

Shanghai - Composite: DOWN 1.5 percent at 3,020.33

Brent North Sea crude: UP 0.5 percent at $111.46 per barrel

West Texas Intermediate: UP 0.4 percent at $108.74 per barrel

Euro/dollar: DOWN at $1.0525 from $1.0540 on Thursday

Pound/dollar: DOWN at $1.2348 from $1.2353

Euro/pound: UP at 85.23 pence from 84.13 pence

Dollar/yen: UP at 130.68 yen from 129.23 yen

New York - Dow: UP 2.8 percent at 34,061.06 (close)

London - FTSE 100: UP 0.1 percent at 7,503.27 (close)

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