Asian Shares Mostly Lower Amid Fed Uncertainty
(RTTNews) - Asian stocks fell broadly on Thursday after the minutes of the latest Federal Reserve meeting offered little clarity on the timing of U.S. interest rate cuts.
Tensions escalated in the Middle East and Fitch downgraded the issuer default ratings of four Chinese national asset management companies, further weighing on sentiment.
Chinese markets ended lower after Fitch downgraded the IDRs of four state-owned asset management companies and put three of them on watch for more potential downgrades, citing increased uncertainty over potential government support.
A private survey highlighted a marked pickup in Chinese service sector activity in December, helping ease some concerns around the economic outlook.
China's Shanghai Composite Index dropped 0.4 percent to 2,954.35, while Hong Kong's Hang Seng Index finished marginally lower at 16,645.98 after a choppy session.
Japanese stocks fell on the first trading day of the year as fading rate cut expectations weighed on the technology sector. A devastating earthquake in the northwest on New Year's Day and weak manufacturing data also dented sentiment.
The Nikkei 225 Index slid 0.5 percent to 33,288.29, while the broader Topix Index settled 0.5 percent higher at 2,378.79 as exporters received a boost from the yen's weakness.
Seoul stocks fell notably, with the Kospi ending down 0.8 percent at 2,587.02 - extending declines for a second day running on concerns that U.S. interest rates may remain at a high level for some time. Hyundai Motor and Korea Electric Power Corp both fell around 2 percent.
Australian markets joined a global slide, with rate-sensitive financials and gold miners leading losses. The benchmark S&P ASX 200 Index fell 0.4 percent to 7,494.10 after declining 1.4 percent in the previous session. The broader All Ordinaries Index settled 0.3 percent lower at 7,730.60.
Across the Tasman, New Zealand's benchmark S&P NZX-50 Index rose 0.3 percent to 11,759.11.
U.S. stocks fell overnight to extend declines from the previous session as the latest Fed meeting minutes shed little light on when rate cuts might begin.
Projections provided by Fed officials at the December 12-13 meeting indicated they expect three quarter point rate cuts by the end of 2024.
Given an unusually elevated degree of uncertainty, participants also noted that rates could stay at current levels for longer than anticipated and that further increases are still possible.
On the data front, U.S. manufacturing activity contracted at a slower pace in December while job openings nudged down to the lowest in more than two years in November.
The tech-heavy Nasdaq Composite declined 1.2 percent to close lower for the fourth consecutive session, while the Dow and the S&P 500 both fell around 0.8 percent.
