Asian stock markets mostly rose on Tuesday as investors braced for another sharp rate hike by the Federal Reserve to cool inflation.
Shanghai, Hong Kong and Seoul Advanced. Tokyo is decreasing. Oil rose more than US$1 per barrel.
Wall Street ended up 0.1% on Monday ahead of this week’s Fed meeting, where officials are expected to announce rate hikes by up to 3/4 of a percentage point, three times the range. normally. That would put the Fed’s benchmark interest rate between 2.25% and 2.5%, the highest since 2018 before the coronavirus pandemic.
The mixed market reaction shows investor sentiment is divided and optimists hope for a “Fed dial back”, Mizuho Bank’s Tan Boon Heng said in a report.
The Shanghai Composite Index rose 0.6% to 3,270.31 while the Nikkei 225 in Tokyo fell less than 0.1% to 27,581.73. The Hang Seng Index in Hong Kong rose 1.4% to 20,808.56.
Alibaba, China’s largest e-commerce company, said on Tuesday it plans to apply for a major listing in Hong Kong. The move will make Alibaba the primary dual-listed company on the New York Stock Exchange and the Hong Kong Stock Exchange.
Alibaba listed shares in New York in September 2014 and completed a secondary listing in Hong Kong in November 2019.
CEO Daniel Zhang said the company is pursuing another major listing site to foster a broader, diversified investor base. That seems to be mainly mainland Chinese investors.
Kospi in Seoul rose 0.3% to 2,408.85 and Sydney’s S&P-ASX 200 was 0.1% higher at 6,798.00. New Zealand retreated while Southeast Asian markets rallied.
Investors fear aggressive Fed rate hikes to curb inflation are at a four-decade high and similar action by central banks in Europe and Asia could derail growth. global economic growth.
US inflation accelerated to 9.1%, the highest level since 1981.
Treasury Secretary Janet Yellen said the US economy is slowing, but healthy hiring suggests it’s not in a recession. Fed officials who have publicly supported rate hikes also cited a relatively strong job market as evidence that the economy can withstand higher borrowing costs.
On Wall Street, the S&P 500 rose to 3,966.84 on Monday. The Dow Jones Industrial Average rose 0.3% to 31,990.04. The Nasdaq Composite fell 0.4% to 11,782.67.
The major indexes are posting solid gains last week following a combination of mostly better-than-expected reports on corporate profits.
On Monday, shares of Walmart fell nearly 10% in after-hours trading after the retail giant lowered its profit outlook for the second quarter and full year. The company says shoppers are cutting back on discretionary items, especially clothing, which offer higher profit margins.
On Thursday, the Commerce Department will release its first estimate of US economic growth for the months ending June. Some forecasters expect the second quarter to fall after output fell 1.6% in the three months ended March.
Also this week, tech heavyweights like Apple, Meta, Microsoft and Amazon will report results. So do Coca-Cola and McDonald’s.
In the energy market, the price of US benchmark crude rose $1.62 to $98.32 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2 to $96.70 on Monday. Brent crude, the base price for international trade, rose $1.80 to $101.99 a barrel in London. It added $1.95 in the previous session to $105.15.
The dollar fell to 136.49 yen from Monday’s 136.72. The euro rose to $1.0237 from $1.0221.
AP Technology Writer Zen Soo contributed.