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Asian stocks were mixed in lackluster trading on Thursday.
Japan's Nikkei 225 reversed course from earlier losses to close at 38,807.38, up 0.3%. Shares of Nissan Motor Co. rose 2.2% after an unconfirmed Japanese media report said the automaker behind the Leaf electric car was about to strike an electric vehicle deal with domestic rival Honda Motor Co. Honda shares rose 1.1%.
Both Nissan and Honda declined to comment.
Sydney's S&P/ASX 200 slipped 0.2% to 7,713.60. South Korea's Kospi rose 0.9% to 2,718.76. Hong Kong's Hang Seng lost 0.9% to 16,929.12, while the Shanghai Composite fell 0.2% to 3,038.23.
“In a significant turn of events, there is increasing speculation that the Bank of Japan may consider an end to its negative interest rate policy at its upcoming meeting, spurred by significant wage increases by major Japanese companies,” said Anderson Alves of ActivTrades.
The Japanese central bank has set an inflation target of 2%. The Bank of Japan will hold a two-day monetary policy meeting next week.
On Wall Street, the S&P 500 slipped 9.96 points, or 0.2%, from its all-time high set the previous day to 5,165.31. The Dow Jones Industrial Average rose 37.83, or 0.1%, to 39,043.32, moving within 90 points of its record set last month. The Nasdaq composite fell 87.87, or 0.5%, to 16,177.77.
The bond market was also relatively calm and government bond yields rose.
Oil prices have seen a general uptick so far this year, helping inflation remain slightly higher than economists expected. That higher inflation has, in turn, dashed Wall Street's hopes that the Federal Reserve could provide relief with a rate cut at its meeting next week.
However, there are still expectations that the Fed will start cutting rates in June as the longer-term inflation trend appears to be heading downwards. The Fed's key interest rate is at its highest level since 2001 and cuts would ease pressure on the economy and financial system. Stocks have already risen in part on expectations of such cuts.
However, its almost non-stop run since late October has drawn criticism that it has been exaggerated.
In the bond market, the 10-year Treasury yield rose to 4.18% on Wednesday from 4.15% late Tuesday. It helps set interest rates on mortgages and loans for all types of businesses and other borrowers.
The yield on two-year government bonds also rose. It is more in line with Fed expectations, rising to 4.62% from 4.58% late Tuesday and from 4.20% in early February. The price had previously fallen due to strong expectations of impending interest rate cuts by the Fed.
In energy trading, benchmark U.S. crude oil rose 11 cents to $79.83 a barrel. Brent crude, the international standard, rose 14 cents to $84.17 a barrel.
In foreign exchange trading, the US dollar rose to 147.96 Japanese yen from 147.74 yen. The euro was at $1.0945, down from $1.0953.
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` business reporter Stan Choe contributed.
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