Asian shares showed a mixed performance on Friday as investors awaited U.S. personal spending data for November. U.S. futures and oil prices experienced declines, setting the tone for the day's trading.
In Tokyo, the Nikkei 225 index remained unchanged at 38,810.26 following the release of November inflation data. Japan's core inflation rate, excluding fresh food prices, exceeded expectations by rising 2.7% year-on-year.
The Bank of Japan's decision to maintain its benchmark rate at 0.25% on Thursday led to a stronger dollar against the Japanese yen, with the dollar trading at 157.11 yen on Friday.
Meanwhile, the Hang Seng in Hong Kong gained 0.1% to 19,774.22, and the Shanghai Composite index rose 0.5% to 3,388.22 after China's central bank kept its loan prime rates steady. The one-year lending rate remained at 3.1%, while the five-year rate stayed at 3.6%.
Australia's S&P/ASX 200 declined by 1.3% to 8,061.40, and South Korea's Kospi lost 1.7% to 2,393.60.
On Wall Street, the S&P 500 dipped 0.1% to 5,867.08, the Dow Jones Industrial Average edged up less than 0.1% to 42,342.24, and the Nasdaq composite slipped 0.1% to 19,372.77.
Market sentiment has been tempered this week, with concerns about high valuations and the need for favorable conditions to sustain current price levels. Despite recent fluctuations, major indexes remain near record highs, with the S&P 500 poised for significant gains this year.
Traders are adjusting their expectations for Federal Reserve interest rate cuts in 2025, with some now anticipating only one or two cuts, compared to earlier projections of at least two cuts. Lower interest rates can stimulate economic activity and asset prices but may also fuel inflation.
Treasury yields fluctuated following expectations of fewer rate cuts by the Fed next year. Reports on the U.S. economy presented a mixed picture, with growth exceeding previous estimates, a stable job market, but unexpected contraction in the manufacturing sector in the mid-Atlantic region.
In the energy markets, U.S. benchmark crude oil declined to $68.96 per barrel, while Brent crude fell to $72.46 per barrel. The euro also weakened against the dollar, trading at $1.0359.
