TOKYO (`) — Asian stocks traded mostly lower Wednesday after an overnight decline on Wall Street, while Tokyo's main benchmark temporarily hit another 30-year high.
U.S. stocks are likely to move lower, with Dow futures falling 0.3% to 37,429.00. S&P 500 futures fell 0.5% to 4,775.25.
Japan's benchmark Nikkei 225 index gave up earlier gains on profit-taking to close down 0.4% at 35,477.75. The Nikkei hit a new 34-year high earlier in the day, or its best since February 1990 during the so-called financial bubble. The focus of buying was on semiconductor stocks, and a weak yen helped fuel problems for some exporters.
Australia's S&P/ASX 200 slipped 0.3% to 7,393.10. South Korea's Kospi fell 2.3% to 2,439.93. Hong Kong's Hang Seng fell 3.8% to 15,267.70. The Shanghai Composite lost 1.5% to 2,851.78.
Official Chinese data released on Wednesday showed that China's economy grew 5.2% in 2023, exceeding the government's target of “about 5%.” This growth was likely supported by GDP of just 3% in 2022 as China's economy slowed due to COVID-19 and nationwide lockdowns during the pandemic.
“Investor expectations for China’s economic growth have declined,” said Stephen Innes, managing partner at SPI Asset Management. “The headwinds facing China’s economy in 2023 have not abated and the geopolitical environment may become more contentious.”
Investors have been keeping an eye on upcoming earnings reports as well as possible moves by the world's central banks to gauge their next moves.
If Wall Street analysts' forecasts are to be believed, companies across the S&P 500 are likely to report meager, if any, fourth-quarter earnings growth compared to last year. Earnings have been under pressure for more than a year due to rising costs and high inflation.
But optimism is greater for 2024, with analysts forecasting strong earnings per share growth of 11.8% for S&P 500 companies, according to FactSet. This, along with expectations of multiple interest rate cuts from the Federal Reserve this year, have helped the S&P 500 post 10 successful weeks out of the last 11 weeks. The index remains within 0.6% of its all-time high reached two years ago
Traders currently expect interest rates to be cut far more by 2024 than the Fed itself has announced. That raises the potential for big market swings surrounding every Fed official speech or economic report.
In energy trading, benchmark U.S. crude lost 56 cents to $71.84 a barrel. Brent crude, the international standard, fell 51 cents to $77.78 a barrel.
In foreign exchange trading, the US dollar rose to 147.86 Japanese yen from 147.09 yen. The euro was at $1.0859, down from $1.0880.
` business reporter Stan Choe in New York contributed to this report.
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