Slide in Chinese shares hampers Asian markets despite Fed optimism
SINGAPORE - Asia shares were hobbled by weakness in Chinese markets on Thursday and struggled to build on Wall Street's rally, even as investor sentiment was lifted by the prospect that the Federal Reserve could still deliver two rate cuts this year.
The Fed on Wednesday left rates unchanged in a widely expected decision, but maintained its projection for two quarter-percentage-point rate cuts by the year-end. Policymakers did revise up their inflation forecast for the year and marked down their outlook for economic growth, citing risks from U.S. President Donald Trump's tariff policies. Still, investors took comfort from the Fed's "dot plot" of policy rate expectations and Chair Jerome Powell's comments that tariff-driven inflation will be "transitory" and largely confined to this year, in turn sending stocks higher while U.S. Treasury yields and the dollar fell. Australian shares jumped 1%, while U.S. futures also extended their rally after the cash session ended on a high. Nasdaq futures ticked up 0.4% and S&P 500 futures advanced 0.3%. EUROSTOXX 50 futures similarly added 0.1%."Reassurance perhaps, but the ongoing path the Fed will tread remains a tight one to navigate, and the central bank remains firmly at the mercy of the incoming data, surveys that can be wholly fickle and market forces that may well still go after a firm response," said Chris Weston, head of research at Pepperstone. Gold similarly scaled yet another record high of $3,055.96 an ounce, helped by the prospect of further Fed easing this year. U.S. stocks rallied on Wednesday, with the Dow gaining just under 1%, the S&P 500 gaining just over 1%, and the Nasdaq adding 1.4%.Trading of cash U.S. Treasuries was closed owing to the Japan holiday, though futures ticked higher, implying lower yields. Bond yields move inversely to prices. That in turn undermined the dollar, which fell 0.27% against the yen to 148.25 , while the euro steadied near a five-month high at $1.0908. Sterling scaled a four-month top of $1.3015 early in the session, ahead of the Bank of England's policy decision later on Thursday where it is similarly expected to keep rates on hold. "We expect the members to signal the desire to see further disinflation as a reason to keep policy on hold this month. They will affirm that the policy direction remains towards further easing, but the timing will be data-dependent," said analysts at ANZ.However, the buoyant mood failed to drive a broader rally across Asia, with MSCI's broadest index of Asia-Pacific shares outside Japan swinging between losses and gains to last trade a marginal 0.1% higher. That was due to a slide in Chinese equities, with benchmark indexes in mainland China and Hong Kong falling sharply just after the open. The CSI300 blue-chip index slid 0.66% while the Shanghai Composite Index last traded 0.46% lower. Hong Kong's Hang Seng Index sank 1.5%. Analysts said there was no obvious trigger behind the move, and attributed it to some profit-taking after a blistering rally led by technology shares. Earlier on Thursday, Beijing held its benchmark lending rates steady for the fifth straight month, matching market expectations. The yuan , which has been pressured by China's wide yield differentials with the United States, was last little changed at 7.2307 per dollar in the onshore market. Its offshore counterpart was similarly steady at 7.2311 per dollar. Elsewhere, data showed Australian employment unexpectedly fell in February to end a strong run of impressive gains, although the jobless rate stayed low. The Aussie fell in response to the weaker-than-expected employment figures and last traded 0.27% lower at $0.6341. Across the Tasman sea, data also out on Thursday showed New Zealand's economy grew faster than forecast in the fourth quarter, dragging the economy out of recession, but the improvement is not expected to change the central bank's planned official cash rate cuts.In commodities, oil prices ticked higher owing in part to an escalation of tensions in the Middle East. Brent crude futures rose 0.5% to $71.13 a barrel, while U.S. West Texas Intermediate crude gained 0.36% to $67.40 per barrel. EU envoy meets commerce minister, discusses trade cooperation100 acres of land allocated for Danish University: PM
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Glob\u0641 l Stock Markets Steady Amid Diplomacy and Tech OptimismGlobal stock markets remained largely unchanged on Tuesday as high-level talks between US and Russian diplomats regarding the Ukraine war provided some stability. Investors, while cautious, showed confidence in the economic outlook and were buoyed by advancements in artificial intelligence and hopes for an easing of China's crackdown on the private sector. European markets edged higher, with Frankfurt hitting a new record high, while Wall Street was relatively stable, with the S&P 500 close to a record.
Read more »
European stock futures, euro climb as Germany stays mainstreamChinese blue chips CSI300 eased 0.26%. Hong Kong shares retreated 0.34%
Read more »
Asian shares slide on US curbs on China, euro gives up gainsHong Kong's Hang Seng index tumbled 2.3%, extending the fall from Monday
Read more »
Europe's top AI plays extend slide, Microsoft data centre worries persistEurope's top AI plays extend slide, Microsoft data centre worries persist
Read more »
Oil recovers as upbeat Chinese manufacturing data increases some optimismLast month, Brent and WTI posted their first monthly decline in three months
Read more »
Chinese animated blockbuster becomes first Asian film to surpass $2 billion in global earningsThe Chinese animated blockbuster Ne Zha 2 has made history by becoming the first non-Hollywood film to surpass $2 billion in global earnings, including presales, according to ticketing platform Maoyan.
Read more »