Asia report: Most markets rise ahead of US Fed decision

18th Sep 2024 09:46

(Sharecast News) - Asia-Pacific markets closed mostly higher on Wednesday, with Australia's benchmark extending its multi-day winning streak to reach an all-time high.

Investors in the region looked to be cautiously optimistic ahead of the US Federal Reserve's interest rate decision due later in the global day.

Markets in South Korea and Hong Kong remained closed for the Chuseok and Mid-Autumn Festival holidays, respectively, while mainland China resumed trading after a three-day national break.

"The odds of a super-sized Federal Reserve interest rate cut later in the day were the subject of traders' focus, as Asian equities displayed a mixed performance," said TickMill's Patrick Miunnelly.

"The US currency experienced a significant decline against the yen, reversing Tuesday's rally.

"This decline was attributed to the unexpectedly robust US retail sales data, which was perceived as undermining the case for aggressive Fed easing."

Munnelly also noted that the euro improved, recouping nearly the entirety of the prior day's decline.

"The probability of the Federal Reserve initiating its easing cycle with a sizable 50 basis point reduction fluctuated in Asia, falling from 67% at the same time on Tuesday to 63% early in the day.

"Nevertheless, the odds were once again at 65% highlighting market nervousness."

Most markets rise as mainland China returns from break

In Japan, the Nikkei 225 rose by 0.49% to close at 36,380.17, and the broader Topix index gained 0.38% to finish at 2,565.37.

The upward movement of Tokyo's benchmark index was supported by gains in healthcare and technology stocks.

Notable performers included M3, which surged 5.3%, Furukawa Electric up by 4.77%, and Sumco increasing by 4.44%.

After a nationwide holiday, China's Shanghai Composite index climbed 0.49% to 2,717.28, while the Shenzhen Component added 0.11% to close at 7,992.25.

Leading the gains in Shanghai were Dalian Thermal Power, which jumped 10.1%, Hubei Mailyard rising 10.08%, and Shanghai Highly Group also up by 10.08%.

Australia's S&P/ASX 200 continued its upward trajectory, albeit with a modest increase of 0.02% to settle at 8,142.10.

The index closed at a record high, driven by strong performances in the consumer discretionary and energy sectors.

EVT saw its shares rise by 5.03%, New Hope Corporation gained 4.63%, and Corporate Travel Management increased by 2.86%.

Contrasting with its regional peers, New Zealand's S&P/NZX 50 index fell by 0.67% to 12,586.98.

The decline was led by Restaurant Brands New Zealand, whose shares dropped 6.35%.

Synlait Milk fell by 4.44%, and exchange operator NZX itself decreased by 3.85%.

In currency trading, the dollar was last down 0.48% on the yen to trade at JPY 141.72.

The greenback also decreased against the Aussie, by 0.36% to AUD 1.4749, while it lost 0.54% on the Kiwi, changing hands at NZD 1.6083.

Oil prices saw a downturn, with Brent crude futures last down 1.26% on ICE at $72.77 per barrel, and the NYMEX quote for West Texas Intermediate decreasing 1.38% to $70.21.

Imports and exports grow modestly in Japan, machinery orders slip

In economic news, Japan's Ministry of Finance announced that imports and exports experienced modest growth in August compared to the same month last year.

Imports rose by 2.3%, and exports increased by 5.6%.

Both figures fell short of expectations, as a Reuters poll had forecasted a 13.4% rise in imports and a 10% increase in exports.

In a separate release, the Cabinet Office reported that private sector machinery orders decreased by 0.1% in July from the prior month.

The decline contrasted with economists' predictions of a 0.5% increase, according to a Reuters survey.

Reporting by Josh White for Sharecast.com.