Equity markets in Asia showed a mixed trend on Friday, suggesting that investors might be reassessing the optimism that drove up shares in the region during the previous session. This hesitation comes as new indications of ongoing inflation surfaced in the US.
Australian stocks remained relatively unchanged, while Japanese equities edged slightly higher. However, Hong Kong's stock market experienced a decline. These movements followed a significant rally on Thursday, which saw a key index of the region's shares reaching its highest level in nearly two years.
Early Asian trading saw contracts for US stocks rising, buoyed by a 0.3% increase in the S&P 500 index on Thursday, marking its 20th record high of the year. This rise was driven by gains in industrial and banking sectors. Notably, Reddit Inc. shares surged by 48% on their debut, but other tech stocks, including Apple Inc. and Alphabet Inc., faltered amid increased regulatory scrutiny.
Apple faced legal challenges, with the US Justice Department and 16 state attorneys general filing antitrust lawsuits against the tech giant. In Europe, there were reports of probes into whether Apple is adhering to the Digital Markets Act. These developments caused Apple's shares to plummet by over 4%, resulting in a $115 billion loss in market value.
US economic data released on Thursday indicated a robust economy, potentially slowing down the Federal Reserve's pace of interest rate cuts. This led to a decline in Treasuries, with yields experiencing upward pressure. Consequently, the dollar strengthened, while the yen also saw a slight increase against the dollar.
Former Treasury Secretary Lawrence Summers suggested that the Fed might be too eager to cut rates, considering the current strength of the economy and financial markets. Societe Generale SA raised its year-end forecast for the S&P 500, citing the ongoing strength of the US market.
Central banks remained in focus, with the Swiss National Bank unexpectedly cutting interest rates and Mexico's central bank also implementing rate cuts. These moves hint at potential policy easing by other major central banks.
Looking ahead in Asia, the Reserve Bank of Australia will release a financial stability review, and Taiwan will publish February jobs data.
In the commodities market, oil prices experienced a slight decline over concerns about global interest rates and tensions in the Middle East. Bitcoin traded below $66,000, while gold prices dipped after reaching above $2,200 an ounce for the first time.
Paraphrasing text from "Investing" all rights reserved by the original author.
