TOKYO (AP) — Asian shares mostly fell Wednesday after worries about the U.S. banking system set off a decline on Wall Street and amid concerns closer to home about Chinese economic growth.

Japan’s benchmark Nikkei 225 lost 0.5% to 32,232.60 in afternoon trading. Australia’s S&P/ASX 200 edged up 0.3% to 7,329.10. South Korea’s Kospi added 1.3% to 2,606.84. Hong Kong’s Hang Seng dropped 0.3% to 19,134.00, while the Shanghai Composite shed 0.4% to 3,247.91.

Clifford Bennett, chief economist at ACY Securities, called the export data out of China “rather alarming,” noting it was the sharpest decline in three years and reflected global economic challenges, not just in China.

“Global demand is falling precipitously,” he said.

“It is now very likely we will all be surprised by just how intense this global economic slowdown becomes. The three major economies of the world — U.S., China and the EU — are leading the downward charge.”

On Wall Street, the S&P 500 fell 19.06, or 0.4%, to 4,499.38 and at one point was down nearly three times that. It was the fifth loss in the last six days for the index after it rocketed through the year’s first seven months.

The Dow Jones Industrial Average fell 158.64, or 0.4%, to 35,314.49 after paring an earlier loss of 465 points. The Nasdaq composite lost 110.07, or 0.8%, to 13,884.32.

In the U.S., bank stocks fell after Moody’s cut the credit ratings for 10 smaller and midsized ones. It cited a list of concerns about their financial strength, from the effects of higher interest rates to the work-from-home trend that’s leaving office buildings vacant.

The Federal Reserve has hiked its main interest rate to the highest level in more than two decades in hopes of grinding down inflation. High rates work by slowing the entire economy bluntly, which has raised the risk of a recession.

The much higher rates have hit banks particularly hard.

While downgrading credit ratings for 10 banks and putting six others under review, Moody’s said the rapid rise in rates has led to conditions that hurt profits for the broad industry.

Higher rates also knock down the value of investments that banks made when rates were super low. Such conditions helped cause three high-profile failures for U.S. banks this past spring, which shook confidence in the system.

Later this week, the U.S. government will release data on consumer and wholesale inflation, which could influence what the Federal Reserve does next with interest rates.

The hope on Wall Street is that the cooldown in inflation since it topped 9% last summer will help persuade the Fed no more rate hikes are needed. Economists expect Thursday’s data to show consumer prices rose by 3.3% in July over a year ago, an acceleration from June’s inflation rate of 3%.

But some economists and investors say getting inflation down that last bit to the Fed’s target of 2% is likely to be the most difficult. They’re saying that Wall Street has become convinced too quickly about a “soft landing” coming for the economy and that the 19.5% run for the S&P 500 through the first seven months of this year was overdone.

In energy trading, benchmark U.S. crude slipped 16 cents to $82.76 a barrel. Brent crude, the international standard, fell 14 cents to $86.03 a barrel.

In currency trading, the U.S. dollar fell to 143.13 Japanese yen from 143.36 yen. The euro cost $1.0979, up from $1.0960.

——

AP Business Writer Stan Choe contributed.