Tokyo: Asian markets displayed mixed trends on Thursday after Wall Street experienced a decline following the US Federal Reserve's decision to raise interest rates for the first time in three years. The rate hike, aimed at controlling US inflation, saw the Fed increase its key interest rate by a quarter percentage point to a target range of 3.75%-4.00%.
According to United News of Bangladesh, US stock futures rose in early trading despite the previous day's downturn. In Asia, Japan's Nikkei 225 rose 0.2% to 64,067.53, and South Korea's Kospi gained 0.9% to 6,778.49. Meanwhile, Hong Kong's Hang Seng Index fell 0.7% to 24,533.46, and the Shanghai Composite declined 0.4% to 3,877.46. Australia's S and P/ASX 200 advanced 0.3% to 8,718.20, while Taiwan's Taiex climbed 1.3%, and India's Sensex edged up 0.3%.
On Wednesday, US markets saw the S and P 500 fall 0.5%, the Dow Jones Industrial Average drop 1.2%, and the Nasdaq Composite remain mostly unchanged. Lorraine Tan, director of equity research for Asia at Morningstar, stated that the market reaction was largely anticipated due to widespread expectations of the Fed's rate increase. However, she noted that the ongoing war in Iran could continue to exert inflationary pressure.
Following the Fed's announcement, the yield on the two-year US Treasury note rose to 4.72%, up from about 4.67% late Tuesday, while the yield on the 10-year Treasury maintained a level around 5.00%. Investors have shown concern over rising US government debt and inflationary pressures linked to an energy shock resulting from the conflict.
In currency markets, the US dollar weakened early Thursday to 156.04 Japanese yen from 156.26 yen, and the euro slightly increased to $1.1467 from $1.1465. Oil prices saw a slight increase as limited oil flows through the Strait of Hormuz continued. This narrow waterway is crucial for global oil shipments, and supply pressures have escalated following Saudi Arabia's shutdown of a major oil pipeline for repairs. Brent crude, the international benchmark, rose 0.1% to $105.89 early Thursday.