Asian Stocks Mixed as Fed Cut Hopes Grow

Asian stocks trade mixed as Fed rate cut hopes lift sentiment, but China and Hong Kong weaken amid new trade tensions.

Asian equities traded mixed on Thursday as investors weighed growing expectations for the U.S. Federal Reserve rate cuts against renewed weakness in Chinese and Hong Kong markets.

The Nikkei 225 rose 0.71% in Tokyo, driven by technology gains, while the Shanghai Composite added 1.09%. However, Hong Kong’s Hang Seng Index slipped 0.24%, and Australia’s S&P/ASX 200 fell 0.39%, reflecting uneven sentiment across the region.

Asian Stocks Mixed as Fed Cut Hopes Grow

Investor confidence was lifted by softer-than-expected U.S. producer price data, which reinforced bets that the Fed could deliver multiple rate cuts this year. Both headline and core producer prices fell 0.1% in August, against expectations of a 0.3% increase.

According to CME Group’s FedWatch Tool, traders now see a 92.1% probability of a quarter-point cut at the next meeting and a 7.9% chance of a larger half-point move. Attention now shifts to U.S. consumer inflation data due later today.

• Japan: The Nikkei advanced to 44,272, supported by tech names such as Advantest and Screen Holdings. SoftBank surged more than 8%, while automakers and banks lagged. Producer prices declined 0.2% month-on-month in August, missing forecasts.
• Australia: The ASX eased to 8,800, with weakness in financials and technology outweighing gains in mining and energy. Gold miners rallied, led by Evolution Mining’s nearly 5% rise, but major banks slipped.
• China & Hong Kong: Sentiment was dented after Mexico imposed tariffs of up to 50% on over 1,400 Asian imports, a move seen as protecting its industries from U.S. trade pressures.

Elsewhere, Taiwan and Indonesia rose around 1%, while South Korea and Singapore finished little changed.

Commodities & Yields

• Gold: $3,666.92 (-0.41%)
• Silver: $41.668 (+0.16%)
• Brent Oil: $67.28 (-0.31%)
• WTI Oil: $63.46 (-0.33%)

Bond yields were steady, with the U.S. 10-year at 4.045%, the UK 10-year at 4.6310%, and Germany’s at 2.6539%.

On Wall Street, both the S&P 500 and Nasdaq notched fresh record highs, though late-session pullbacks capped gains. Oil prices briefly climbed to $63.70 amid geopolitical tensions.

Looking ahead, investors will closely watch U.S. inflation data and the European Central Bank’s policy decision, with the ECB press conference scheduled for 12:45 PM GMT.

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