Asian markets showed a mixed performance on Thursday following a subdued day on Wall Street. Traders awaited a series of US data releases, which could influence Federal Reserve officials ahead of their upcoming policy meeting. The recent hot consumer price index reading did not dampen optimism for potential interest rate cuts this year, but analysts cautioned that sentiment could be tested by the producer prices index (PPI) data expected later in the day. While equities may remain range-bound until after the Fed meeting, investors are keenly watching for any clues on the future trajectory of interest rates, with expectations aligned with the Fed’s current forecasts for three reductions this year.
According to Stephen Innes at SPI Asset Management, the PPI data typically does not trigger significant market movements, but concerns about inflation could lead to minor turbulence if the figure exceeds expectations. Additionally, Thursday will see the release of retail sales, jobless claims, and consumer sentiment figures from Washington.
In New York, a pullback in tech giants, including Nvidia, Apple, and Tesla, weighed on the S&P 500 and Nasdaq, while the Dow ended slightly higher. Paris and Frankfurt had set new records earlier in the day. In Asia, Hong Kong rebounded after a dip, while Shanghai, Singapore, Seoul, Taipei, and Manila posted gains. However, Tokyo retreated amid speculation that the Bank of Japan may begin to move away from its ultra-loose monetary policy. Sydney, Wellington, and Jakarta also experienced declines.
Investors remained cautious amidst escalating China-US tensions. The House of Representatives approved a bill that could force TikTok’s Chinese owner to divest from the company, drawing warnings from China of potential consequences. Meanwhile, Bitcoin hovered just below $73,000 after reaching a record high of $73,664. Oil prices edged higher following a rally driven by falling US stockpiles and reports of Ukraine targeting Russian refineries.
