Asian stock markets showed a mixed performance on Wednesday as investors awaited the U.S. Federal Reserve’s decision on interest rates, while U.S. futures edged higher and oil prices saw a decline.
In Japan, the trade surplus for February exceeded expectations with exports rising over 11%. The Japanese central bank, in line with forecasts, kept its benchmark interest rate steady at 0.5%. Likewise, the U.S. Federal Reserve is anticipated to maintain its current interest rates as well.
Japan’s benchmark Nikkei 225 rose by 0.2%, closing at 37,900.88. Meanwhile, Hong Kong’s Hang Seng index also gained 0.2%, reaching 24,777.01. The Shanghai Composite, however, saw minimal movement, dipping just 0.1% to 3,427.76.
In contrast, Australia’s S&P/ASX 200 saw a slight decline, falling 0.3% to 7,836.80. South Korea’s Kospi index added 0.9%, closing at 2,634.60.
Investors are closely watching the Federal Reserve’s meeting on Wednesday, particularly its forecasts for interest rates, inflation, and the overall economy. Wall Street traders are largely predicting that the Fed may deliver two to three rate cuts by the end of 2025.
The previous day saw a significant downturn on U.S. markets, with the S&P 500 dropping 1.1% to 5,614.66. The Dow Jones Industrial Average fell 0.6% to 41,581.31, and the Nasdaq Composite dropped 1.7% to 17,504.12.
Tesla’s stock took a significant hit, falling by 5.3%. The electric vehicle maker has been struggling with declining sales, along with concerns surrounding CEO Elon Musk’s decisions, including his push for reduced government spending. In addition, competition from Chinese EV manufacturer BYD, which recently announced a rapid-charging system, has intensified.
Alphabet, the parent company of Google, saw a 2.2% drop after announcing its acquisition of cybersecurity firm Wiz for $32 billion. This deal, set to be the company’s largest acquisition, aims to bolster Alphabet’s cloud computing services amidst the growing demand for artificial intelligence technologies.
The ongoing slide in Big Tech stocks reflects a broader market trend where previously high-flying stocks are now experiencing sharp declines due to concerns about overvaluation. Notably, stocks benefiting from the AI boom have been hit hard, with Nvidia falling 3.3% and Super Micro Computer dropping 9.6%. Palantir Technologies, a company offering AI solutions, saw its stock decline by 4%.
The market’s uncertainty is further compounded by concerns over President Donald Trump’s trade policies. His ongoing trade war has raised fears that tariffs and other measures could dampen U.S. consumer and business spending, potentially impacting the broader economy.
The Federal Reserve faces increasing complexity as it begins its latest meeting, with many market participants expecting the central bank to hold its current policy stance. While rate cuts could encourage borrowing and economic activity, they also pose inflation risks—especially amid rising consumer prices triggered by tariffs.
In energy markets, benchmark U.S. crude dropped 26 cents to $66.65 per barrel, while Brent crude, the international benchmark, fell 23 cents to $69.89 per barrel.
Currency markets saw slight shifts, with the U.S. dollar rising to 149.42 Japanese yen, up from 149.25 yen. The euro dipped slightly to $1.0941 from $1.0946.
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