Stock market today: Asian benchmarks trade mixed amid expectations for US rates to stay high

Apr 16, 2024, 1:26 AM | Updated: 7:22 pm

TOKYO (AP) — Asian shares were trading mixed Wednesday, as expectations resurfaced that U.S. interest rates may stay high for a while.

Japan’s benchmark Nikkei 225 dipped 0.6% in morning trading to 38,226.39. Australia’s S&P/ASX 200 edged up 0.2% to 7,624.70. South Korea’s Kospi declined 0.3% to 2,603.22. Hong Kong’s Hang Seng added 0.2% to 16,283.91, while the Shanghai Composite gained 0.6% to 3,026.20.

The mixed reaction came after Federal Reserve Chairman Jerome Powell said at an event Tuesday that the central bank has been waiting to cut its main interest rate, which is at its highest level since 2001, because it first needs more confidence inflation is heading sustainably down to its 2% target.

“Appetite for risk-taking remains weak, with Federal Reserve Chair Jerome Powell validating a later timeline for rate cuts, alongside a raft of Fed speakers calling for more patience in easing,” said Yeap Jun Rong, market analyst at IG.

On Wall Street, the S&P 500 fell 10.41 points, or 0.2%, to 5,051.41. The index deepened its loss from the day before, when it sank under the pressure brought by a jump in Treasury yields.

The Dow Jones Industrial Average rose 63.86, or 0.2%, to 37,798.97, and the Nasdaq composite fell 19.77, or 0.1%, to 15,865.25.

But the majority of stocks fell as Treasury yields rose following Powell’s comments. They’ve been climbing rapidly as traders give up hopes that the Fed will deliver many cuts to interest rates this year. High rates hurt prices for all kinds of investments and raise the risk of a recession in the future.

“The recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said, referring to a string of reports this year that showed inflation remaining hotter than forecast.

He suggested if higher inflation does persist, the Fed will hold rates steady “for as long as needed.” But he also acknowledged the Fed could cut rates if the job market unexpectedly weakens.

The yield on the two-year Treasury, which tracks expectations for Fed action, shot as high as 5% immediately after Powell spoke and got back to where it was in November.

But yields later pared their gains as the afternoon progressed, and the two-year yield drifted back to 4.98%. That’s still up from 4.91% late Monday.

Traders are mostly betting on the Fed delivering just one or two cuts to interest rates this year after coming into 2024 expecting six or more. They’re now also betting on a 12.5% probability that no cuts are coming, up from just 1.2% a month ago, according to data from CME Group.

Companies are under even more pressure than usual to report fatter profits and revenue because the other lever that sets stock prices, interest rates, looks unlikely to add much lift soon.

The stock of Donald Trump’s social-media company also slumped again. Trump Media & Technology Group fell another 14.2% to follow up on its 18.3% slide from Monday.

The company said it’s rolling out a service to stream live TV on its Truth Social app, including news networks and “other content that has been cancelled, is at risk of cancellation, or is being suppressed on other platforms and services.”

The stock has dropped below $23 after nearing $80 last month as euphoria fades around the stock and the company made moves to clear the way for some investors to sell shares.

In energy trading, benchmark U.S. crude shed 47 cents to $84.89 a barrel. Brent crude, the international standard, fell 44 cents to $89.58 a barrel.

In currency trading, the U.S. dollar inched up to 154.67 Japanese yen from 154.65 yen. The euro cost $1.0630, up from $1.0617.


AP Business Writer Stan Choe contributed.


FILE - Coco Gauff of the U.S. plays a shot against Poland's Iga Swiatek during their semifinal matc...

Associated Press

Coco Gauff to be female flag bearer for US team at Olympic opening ceremony, joining LeBron James

PARIS (AP) — Tennis star Coco Gauff will join LeBron James as a flag bearer for the US Olympic team at Friday’s opening ceremony. Gauff, the reigning US Open champion, is set to make her Olympic debut and will be the first tennis athlete to carry the US flag. She and James were chosen by […]

9 hours ago

Utah Gov. Spencer Cox speaks about Salt Lake City's bid to host the 2034 Winter Olympics, during th...

Associated Press

IOC awards 2034 Winter Games to Salt Lake City. Utah last hosted the Olympics 32 years ago

PARIS (AP) — Salt Lake City will be an Olympics host again after the IOC formally awarded the 2034 Winter Games to the United States bid on Wednesday. The capital city of Utah was the only candidate since the International Olympic Committee gave Salt Lake City exclusive negotiating rights last year in the process that […]

10 hours ago

FILE - Simone Biles competes on the uneven bars at the United States Gymnastics Olympic Trials on S...

Associated Press

Biles, Richardson, Osaka comebacks ‘bigger than them.’ They highlight issues facing Black women

PARIS (AP) — When Naomi Osaka lifts her racket on the red clay courts at Roland Garros during the Paris Olympics later this month, it’ll represent more than a high-stakes competition for the tennis star. For Osaka, a four-time grand slam champion, it’s an important step in her journey after returning to tennis earlier this […]

11 hours ago

FILE -Gen. Mohammed Hamdan Dagalo, the deputy head of the military council speaks at a ceremony in ...

Associated Press

Sudan paramilitary leader plans to attend cease-fire talks in Switzerland hosted by US, Saudi Arabia

GENEVA (AP) — Sudan’s paramilitary leader has announced plans to attend cease-fire talks in Switzerland next month arranged by the United States and Saudi Arabia. Gen. Mohammed Hamdan Dagalo, head of the Rapid Support Forces fighting Sudan’s army, expressed hope on social media late Tuesday that the talks would become “a major step” toward peace […]

11 hours ago

Associated Press

Stock market today: Asian shares are mixed after Wall Street breaks losing streak

BANGKOK (AP) — Shares were mixed Tuesday in Asia after U.S. stocks closed broadly higher, as Big Tech stocks took back some of their recent sharp declines. U.S. futures edged lower and oil prices were little changed. Tokyo’s Nikkei 225 closed nearly unchanged, at 39,594.39. Chinese markets declined, with the Hang Seng in Hong Kong […]

2 days ago

Associated Press

Hamas and Fatah sign declaration in Beijing on ending yearslong rift, Chinese state media says

BEIJING (AP) — Palestinian factions Hamas and Fatah signed a declaration in Beijing on ending yearslong rift, state media said Tuesday, without providing further details. The two rival Palestinian groups met with Chinese Foreign Minister Wang Yi, concluding talks that started Sunday.

2 days ago

Stock market today: Asian benchmarks trade mixed amid expectations for US rates to stay high