Hong Kong (AP) In reaction to perhaps dismal economic statistics, Asian equities sank Friday, following Wall Street’s dip.
Oil and U.S. futures prices barely moved.
On Thursday, Chinese leaders concluded their two-day summit in Beijing on economic strategy. Despite the absence of specifics in the readouts from the top leaders’ private discussions, investors were expecting significant steps to boost the economy. According to state media, officials decided to relax credit to promote more investment and spending and to raise government borrowing to fund more expenditures.
Yeap Jun Rong of IG stated in a commentary that Chinese authorities have been trapped in a more reactionary policy mode since it is difficult for policymakers to make any commitments at this time due to the uncertainty of U.S. tariff plans.
Hong Kong’s Hang Seng fell 1.7% to 20,057.69, while the Hang Seng Properties index saw a 3% decline. At 3,410.99, the Shanghai Composite index had a 1.5% decline.
In morning trade, Japan’s benchmark Nikkei 225 fell 1.2% to 39,360.43. According to a Bank of Japan study, the fourth quarter of this year saw higher-than-expected business sentiment among major Japanese manufacturers.
Additionally, Australia’s S&P/ASX 200 fell 0.5% to 8,292.40 in Asia. The Kospi in South Korea increased 0.6% to 2,497.61.
The S&P 500 saw a 0.5% decline on Thursday, closing at 6,051.25, its fourth loss in the previous six days. One of the best years of the millennium had been on the horizon for the index.
The Nasdaq composite fell 0.7% to 19,902.84, while the Dow Jones Industrial Average fell 0.5% to 43,914.12.
According to a survey, more American workers than anticipated filed for unemployment insurance last week. A separate update, meanwhile, showed that inflation at the wholesale level, before it reaches U.S. consumers, was hotter last month than economists expected.
Although neither report raises red flags, it did dampen expectations that the Fed will continue to lower interest rates. Because inflation has been declining and the economy is strong enough to avoid a recession, this anticipation has propelled the S&P 500 to 57 all-time highs so far this year.
At its meeting next week, traders are generally anticipating that the Fed will lower its main interest rate. That would be a third straight cut by the Fed after itbegan lowering rates in Septemberfrom a two-decade high. It s hoping to support aslowing job marketafter getting inflation nearly all the way down to its 2% target.
Although lower rates would improve investment prices and the economy, they could also increase inflation.
The Fed would follow other central banks if it made a cut next week. TheEuropean Central Bank cut ratesby a quarter of a percentage point on Thursday, as many investors expected, and the Swiss National Bank cut its policy rate by a steeper half of a percentage point.
Following its decision, Switzerland s central bank pointed to uncertainty about how U.S. President-elect Donald Trump s victory will affect economic policies, as well as about where politics in Europe is heading.
Trump has talked uptariffs and other policiesthat could upend global trade. He rang thebell marking the start of tradingat theNew York Stock Exchange on Thursday to chants of USA.
In other dealings early Friday, U.S. benchmark crude oil picked up 8 cents to $70.10 per barrel. Brent crude oil, the international standard, gained 6 cents to $73.47 per barrel.
The U.S. dollar rose to 153.06 Japanese yen from 152.55 yen. The euro fell to $1.0462 from $1.0472.
___
AP Business Writer Stan Choe contributed.
The Associated Press, 2024. All rights reserved. All rights reserved. It is prohibited to publish, broadcast, rewrite, or redistribute this content without authorization.
Note: Every piece of content is rigorously reviewed by our team of experienced writers and editors to ensure its accuracy. Our writers use credible sources and adhere to strict fact-checking protocols to verify all claims and data before publication. If an error is identified, we promptly correct it and strive for transparency in all updates, feel free to reach out to us via email. We appreciate your trust and support!