Finance
Asian stocks largely remain ahead of central bank meetings
TOKYO (AP) — Asian shares fell largely in cautious trading Tuesday ahead of meetings of central banks around the world.
The Federal Reserve, the Bank of England and the Bank of Japan are holding monetary policy meetings this week.
Japan’s benchmark Nikkei 225 reversed earlier losses and rose 0.2% to 38,525.95 in afternoon trading. Australia’s S&P/ASX 200 fell 0.5% to 7,953.20. South Korea’s Kospi lost 1% to 2,738.19. Hong Kong’s Hang Seng fell 1.3% to 17,014.17, while the Shanghai Composite index fell 0.4% to 2,879.30.
“Markets may have a hard time positioning this week’s central bank meetings,” Mizuho Bank’s Jing Yi Tan said in a commentary.
In Japan, the government reported that the country’s unemployment rate was 2.5% in June, down slightly from 2.6% the month before and marking the first improvement in five months.
US stock indexes had a mixed finish on Monday, to kick off a week of earnings reports Wall Street’s Most Influential Companies and a Federal Reserve Meeting about interest rates.
The S&P 500 rose 0.1% to 5,463.54, following its first consecutive weekly losses since April. The Dow Jones Industrial Average fell 0.1% to 40,539.93, and the Nasdaq composite rose 0.1% to 17,370.20.
ON Semiconductor helped lead the market with an 11.5% jump after the supplier to the automotive and other industries reported stronger spring earnings than analysts expected. McDonald’s rose 3.7% despite the profit and turnover figures for the last quarter that did not live up to the predictions. Analysts said performance at U.S. restaurants was not as bad as some investors had feared.
Oil and gas companies were among the heaviest weights in the market after oil prices fell to levels seen two months ago. ConocoPhillips lost 1.6%, and Exxon Mobil fell 1% on concerns about how much crude the faltering Chinese economy will burn.
Some of Wall Street’s biggest names will announce their results later this week: Microsoft on Tuesday, Meta Platforms on Wednesday and Apple and Amazon on Thursday. Their stock movements carry extra weight on Wall Street because they are among the largest in the market by total value.
Such Big Tech stocks drove the S&P 500 to dozens of records this year, thanks in part to investors madness surrounding artificial intelligence technology, but this month they lost momentum and became too expensive due to criticism, and because alternatives started to look more attractive. Last week, investors found earnings reports from Tesla And Alphabet disappointing, raising concerns that other stocks in the so-called “Magnificent Seven” group of Big Tech stocks might also fail to impress.
Smaller inventories have risen on expectations that are slowing down inflation will prompt the Federal Reserve to cut interest rates soon. But that pattern disappeared somewhat on Monday as the majority of Big Tech stocks rose, while smaller stocks in the Russell 2000 index fell 1.1%. The index is still up a market-leading 9.2% year to date.
The Fed will hold a policy meeting on interest rates this week, with an announcement expected on Wednesday. Almost no one expects a move then, but the widespread expectation is that rates will start easing at the next meeting in September.
Government bond yields remained relatively stable in the bond market, with the yield on ten-year government bonds falling to 4.17% from 4.19% at the end of Friday. In April this was 4.70%.
In energy trading, benchmark U.S. crude lost 39 cents to $75.42 a barrel. Brent crude, the international standard, fell 37 cents to $79.41.
In currency trading, the US dollar rose from 154.00 yen to 155.02 Japanese yen. The euro cost $1.0824, down from $1.0826.
