Asia-Pacific Markets Down as Investors Brace for Powell’s Speech

Asia-Pacific markets are down as investors await Fed Chair Powell’s speech at Jackson Hole, with global markets cautious.

Global Markets Summary:

• Asian Stock Markets:
  • Nikkei: -0.11%
  • Shanghai Composite: -0.03%
  • Hang Seng: -0.43%
  • ASX: -0.18%
• Commodities:
  • Gold: $2527.35 (+0.39%)
  • Silver: $29.23 (+0.71%)
  • Brent Oil: $77.2 (-0.09%)
  • WTI Oil: $73.02 (-0.08%)
• Rates:
  • U.S. 10-year yield: 3.845%
  • U.K. 10-year yield: 3.963%
  • Germany 10-year yield: 2.245%

Asia-Pacific Markets: Asia-Pacific stock markets are broadly down on Friday as global investors remained cautious ahead of U.S. Federal Reserve Chairman Jerome Powell’s upcoming speech at the Jackson Hole symposium. Powell’s address is eagerly anticipated by market participants worldwide because it has the potential to signal shifts in U.S. monetary policy.

In Japan, the Nikkei 225 erased earlier gains to close down by 0.11%, while the broader Topix index saw a marginal uptick. Japanese inflation data for July indicated stability, with the headline inflation rate holding at 2.8% year-on-year, matching June’s figure. Core inflation, which excludes fresh food, increased to 2.7%, while the “core-core” inflation rate, excluding fresh food and energy, fell to 1.9% from 2.2% in June, marking the lowest rate since September 2022. Bank of Japan Governor Kazuo Ueda addressed parliament, stressing the central bank’s vigilance in the face of ongoing market volatility.

Asia-Pacific Markets Down as Investors Brace for Powell’s Speech

South Korea’s Kospi fell by 0.51% in the region, and the Kosdaq, which focuses on smaller companies, dropped 0.58%. Australia’s S&P/ASX 200 was down by 0.18%, continuing a trend of regional declines. Meanwhile, Hong Kong’s Hang Seng index slid by 0.43%, with the mainland China CSI 300 index extending its losing streak to a fourth consecutive session.

Commodities Update: In the commodities market, precious metals saw gains, with gold rising 0.39% to $2527.35 and silver increasing 0.71% to $29.23. Oil prices, however, edged lower, with Brent crude down 0.09% at $77.2 and WTI crude slipping 0.08% to $73.02.

Rates and U.S. Data: In the bond markets, the yield on the U.S. 10-year Treasury stood at 3.845%, while the U.K. 10-year yield was at 3.963% and Germany’s 10-year yield at 2.245%. U.S. economic data released on Thursday showed mixed results, with unemployment claims matching expectations at 232,000, while the Flash Manufacturing PMI came in below expectations at 48.0 compared to the anticipated 49.5. The Flash Services PMI, however, surpassed expectations, registering at 55.2 against a forecast of 54.0.

Global Market Impact: Overnight, U.S. markets closed in the red, with the Nasdaq Composite leading the decline, down 1.67%. The S&P 500 and the Dow Jones Industrial Average also fell, slipping 0.89% and 0.43%, respectively.

Looking Ahead: Investors will now focus on the upcoming events, including Canadian retail sales figures and U.S. existing home sales data, with the spotlight on Powell’s speech later today at 2:00 PM GMT. His remarks could provide critical insights into the future trajectory of U.S. interest rates, influencing market sentiment globally. At 3:00 PM GMT, Bank of England Governor Andrew Bailey is also set to speak, which could further impact the markets.

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