HONG KONG – Asian markets traded unevenly Thursday after Wall Street finished lower in the wake of the Federal Reserve’s first interest-rate increase in three years.
U.S. stock futures, however, pointed higher.
The Fed raised its benchmark rate by a quarter percentage point, lifting its target range to 3.75% to 4.00% as policymakers seek to curb U.S. inflation, which has remained persistently above the central bank’s goal.
Japan’s Nikkei 225 rose 0.3% to 64,136.25, while South Korea’s Kospi slipped less than 0.1% to 6,715.41. Hong Kong’s Hang Seng declined 0.6% to 24,569.40, and the Shanghai Composite fell 0.4% to 3,875.60.
Australia’s S&P/ASX 200 added 0.4%, reaching 8,732.40.
Taiwan’s Taiex advanced 1%, while India’s Sensex posted a modest 0.3% gain.
In the U.S. on Wednesday, the benchmark S&P 500 lost 0.5%. The Dow Jones Industrial Average dropped 1.2%, while the tech-focused Nasdaq composite was little changed.
The market response was largely anticipated because the rate increase matched expectations, Lorraine Tan, Morningstar’s director of equity research for Asia, said Thursday. Still, she said the continuing Iran war could sustain inflationary pressure.
After the Fed’s announcement, the yield on the two-year U.S. Treasury note climbed to 4.69%, from roughly 4.67% late Tuesday. The 10-year Treasury yield remained near an elevated 5.00%.
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Government bond yields have stayed high since the war began, as an energy shock linked to the conflict has intensified inflation concerns. Investors are also focused on the expanding U.S. national debt.
The U.S. dollar fell early Thursday to 155.67 Japanese yen from 156.26 yen. The euro was trading at $1.1478, up from $1.1465.
Oil prices fell. There are still limited oil flows in the Strait of Hormuz, the narrow waterway crucial for global oil transport, and as Saudi Arabia’s closure of a key oil pipeline adds to oil supply pressure as it moves to repair the pipeline.
Brent crude, the international standard, traded 1.7% lower at $104.01 a barrel early Thursday, but still well above the around $72 per barrel in late February before the war.
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AP Business Writer Stan Choe contributed to this report.
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