Asian stock markets mostly rose Monday ahead of what is expected to be a Federal Reserve decision this week to raise interest rates again amid investor hopes the U.S. central bank will scale back plans for more increases.
Tokyo, Hong Kong and Seoul advanced while Shanghai declined. Oil prices fell. The euro stayed below $1.
Wall Street ended last week higher after Apple and other big companies reported strong profits and a closely watched measure of inflation accelerated in September.
The Fed is widely expected at this week's meeting to announce another rate hike of 0.75 percentage points, three times its usual margin. Investors are looking for signs officials are satisfied that earlier increases imposed to cool inflation that is near a four-decade high are working and future increases can be smaller.
Investors worry rate hikes by the Fed and other central banks to cool inflation might tip the global economy into recession. The U.S. central bank has raised its benchmark lending rate to a range of 3% to 3.25% from close to zero in March.
“The tone from Fed Chair Jerome Powell will be important” after this week's meeting, said Yeap Jun Rong of IG in a report. Investors are looking for “increased concerns on economic conditions” instead of the “current head-on resolve to tame inflation.”
The Nikkei 225 in Tokyo gained 1.6% to 27,529.33, as the government reported that retail sales rose in September, though industrial production weakened.
The Shanghai Composite Index shed 0.2% to 2,909.48 after a manufacturing survey showed a weakening in production and demand. Hong Kong's Hang Seng advanced 0.7% to 14,970.21.
The Kospi in Seoul added 0.9% to 2,289.00 and Sydney's S&P-ASX 200 gained 0.8% to 6,836.80. New Zealand and Southeast Asian markets also gained.
On Wall Street, the benchmark S&P 500 index rose 2.5% on Friday to 3,901.06 after U.S. government data showed consumer prices rose 6.2% over a year earlier September, the same as the previous month’s rate.
Core inflation, which removes volatile food and energy prices to show the underlying trend, accelerated to 5.1% from August’s 4.9%. Powell and other Fed officials have said they are ready to keep interest rates elevated until they are sure inflation is extinguished.
The Dow Jones Industrial Average rose 2.6% to 32,861.80. The Nasdaq composite climbed 2.9% to 11,102.45.
Apple Inc. rose 7.6% after it reported higher quarterly profit than expected. Intel Corp. jumped 10.7% after delivering bigger earnings than expected but said it saw “worsening economic conditions.” Gilead Sciences Inc. soared 12.9% and T-Mobile US Inc. gained 7.4% after they also beat profit forecasts.
Amazon.com Inc. lost 6.8% after the company gave a weaker revenue forecast than expected.
Earlier in the weak, Facebook operator Meta Platforms Inc. lost nearly a quarter of its stock market value after reporting a second straight quarter of revenue decline. TikTok. Microsoft Corp. and Google’s parent company, Alphabet Inc., also reported slowdowns in key areas.
Also Friday, government data showed wage increases for American workers were in line with expectations. Powell has cited wages as one measure the Fed is watching as it decides whether to raise rates.
The yield on the two-year Treasury, which tends to track expectations for Fed action, rose to 4.42% from 4.28% late Thursday. The 10-year yield, which helps set rates for mortgages and many other loans, climbed to 4.01% from 3.93%.
In energy markets, benchmark U.S. crude lost 33 cents to $87.57 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.18 to $87.90 on Friday. Brent crude, used to price international oils, retreated 52 cents to $93.25 per barrel in London. It declined $1.19 on Friday to $95.77.
The dollar rose to 148.06 yen from Friday's 147.53 yen. The euro edged down to 99.53 cents from 99.55 cents.
