Asian Markets Mixed After Wall Street Retreats
Asian markets displayed a mixed performance on Thursday, following a decline in Wall Street stocks due to losses in the technology sector.
Tokyo's Nikkei 225 index rose 0.7%, while Australia's S&P/ASX 200 gained 0.8%. South Korea's Kospi remained unchanged after the central bank lowered its benchmark interest rate to support the slowing economy.
Chinese shares experienced a decline as investors sold to secure profits from recent gains. Hong Kong's Hang Seng index fell 1.3%, and the Shanghai Composite index dropped 0.4%.
U.S. markets will be closed for Thanksgiving on Thursday and will reopen for a half day on Friday.
Wall Street Retreats on Tech Losses
The S&P 500 fell 0.4% on Wednesday, snapping a seven-day winning streak. The Dow Jones Industrial Average also declined 0.3%, marking its first loss after five gains. The Nasdaq composite, heavily weighted with technology stocks, fell 0.6%.
Losses for tech giants like Nvidia, Microsoft, and Broadcom dragged the market down. Semiconductor giant Nvidia fell 1.2%, while Microsoft and Broadcom declined 1.2% and 3.1%, respectively.
Several personal computer makers also contributed to the market decline following their latest earnings reports.
U.S. Economy Expands at Healthy Pace
The U.S. economy expanded at a healthy 2.8% annual pace from July through September, driven by strong consumer spending and a surge in exports.
Consumers have been the driving force behind economic growth, but recent earnings reports from retailers paint a mixed picture. Department store operator Nordstrom fell 8.1% after warning investors about weakening sales, while clothing retailer Urban Outfitters jumped 18.3% after exceeding analysts' expectations.
Inflation Decline Stalls
The decline in inflation appears to be stalling as it nears the Fed's target of 2%. The PCE, the Fed's preferred measure of inflation, was just below 7.3% in June 2022. Another measure, the consumer price index, peaked at 9.1% at the same time.
The latest data suggest that inflation is not falling as quickly as it was earlier in the year. This could prompt the Fed to reconsider future interest rate cuts.
Wall Street Expects Rate Cut, Trump Tariffs Pose Risk
Wall Street expects a quarter-point rate cut at the Fed's December meeting. However, President-elect Donald Trump's plans to impose tariffs on Mexico, Canada, and China could raise prices and prompt the Fed to rethink its plans.
Other Market Movements
U.S. benchmark crude oil lost 21 cents to $68.51 per barrel, while Brent crude fell 21 cents to $72.09 per barrel. The dollar rose to 151.72 Japanese yen, while the euro fell to $1.0545.