Shares in Asia showed a mixed performance on Thursday following a lackluster close on Wall Street, driven by a report indicating a slight increase in U.S. inflation last month. The dollar strengthened against the Japanese yen, reflecting expectations of a stronger dollar under the anticipated policies of President-elect Donald Trump's administration.
Japan's Nikkei 225 index inched up by less than 0.1%, while South Korea's Kospi advanced by 0.5% and Australia's S&P/ASX 200 gained 0.4%. However, Chinese markets experienced declines, with Hong Kong's Hang Seng falling by 0.9% and the Shanghai Composite index losing 0.3%.
Other markets in Asia also saw mixed results, with Bangkok's SET dropping by 0.2%, Taiwan's Taiex falling by 0.5%, and India's Sensex edging 0.1% higher. The strengthening dollar has put pressure on other economies, particularly those closely tied to China, leading to concerns about the impact on countries with significant USD-denominated debt.
In the U.S., stocks closed with a mixed performance as the latest inflation data raised hopes for a potential interest rate cut next month to support the economy. The S&P 500 and Dow Jones Industrial Average saw marginal gains, while the Nasdaq composite slipped slightly.
The Federal Reserve's recent interest rate cuts have been aimed at sustaining the job market and achieving its inflation target of 2%. Expectations for further rate cuts have increased, with traders anticipating an 80% probability of a third cut at the Fed's upcoming meeting.
Trump's election victory has introduced uncertainty regarding the Fed's future actions, given his proposed policies of lower tax rates, higher tariffs, and reduced regulation. While lower interest rates can stimulate economic growth, they also have the potential to fuel inflation.
In the cryptocurrency market, bitcoin and other cryptocurrencies experienced fluctuations, with bitcoin trading at $90,300 and Dogecoin, a favorite of Elon Musk, showing volatility. Trump's support for cryptocurrencies has influenced market sentiment.
In the oil market, U.S. benchmark crude oil and Brent crude prices fluctuated, with U.S. crude shedding 37 cents to $68.06 per barrel and Brent crude giving up 29 cents to $71.99 per barrel. The euro also weakened against the dollar.
