Asian shares retreated Wednesday after a lackluster session on Wall Street, though Tokyo broke ranks, gaining more than 2% as a weaker yen lifted stock prices for export manufacturers.
U.S. futures declined while oil prices gained.
Tokyo’s Nikkei 225 is trading near a 34-year high, gaining 2.1% to 34,465.00, helped by heavy buying of chipmakers and by speculation that the Bank of Japan may not opt to change its ultra-lax monetary policy as soon as thought after wages fell for a 20th straight month in November.
A weakening of the yen against the U.S. dollar also lifted share prices of export manufacturers like computer chip maker Kyocera Corp., which jumped 5.7%. Sony Group Corp. was up 3.8% and robot-maker Fanuc Corp. advanced 2.8%.
The U.S. dollar rose to 145.06 Japanese yen from 144.48 yen. It had dipped earlier on expectations the Bank of Japan might be poised to shift gears after years of keeping its benchmark interest rate at minus 0.1%.
Elsewhere in Asia, Hong Kong’s Hang Seng slipped 1% to 16,058.00, and the Shanghai Composite index lost 0.5% to 2,879.76.
South Korea’s Kospi shed 0.7% to 2,542.97, after the country’s unemployment rate stood at the highest since January 2022, according to Statistics Korea.
The S&P/ASX 200 in Australia slipped 0.7% to 7,468.50. Wednesday's data showed Australian consumer price inflation, or CPI, dropped to a nearly two-year low of 4.3% in November, raising expectations of policy easing measures.
On Tuesday, the S&P 500 slipped 0.1% to 4,756.50, following its best day in nearly two months. The Dow Jones Industrial Average fell 0.4% to 37,525.16, and the Nasdaq composite rose 0.1% to 14,857.71.
Eversource Energy tumbled 7.7% for one of the worst losses in the S&P 500 after it said it could face a hit of up to $1.6 billion against its results for the end of 2023.
Unity Software fell 8% after it said it will cut about a quarter of its workforce, or 1,800 positions.
Boeing also declined, but not by as much as on Monday, the first trading day after one of its jets flying for Alaska Airlines suffered an in-flight blowout over Oregon. Its stock lost 1.4% after tumbling 8% Monday. Spirit AeroSystems, which makes fuselages and other parts for Boeing, slipped 0.4%.
Elsewhere in the airline industry, JetBlue Airways lost 10.2% after its chief executive, Robin Hayes, said he will step down for health reasons. He will be replaced by JetBlue’s current president, Joanna Geraghty, who will become the first woman to lead a major U.S. airline.
On the winning side of Wall Street, Illumina gained 4.5% after the biotechnology company said it expects to report stronger revenue for the end of 2023 than analysts had forecast.
Nvidia, meanwhile, rose 1.7% to set an all-time high for a second straight day. And as one of Wall Street's largest stocks, its movements carry more weight on the S&P 500 and other indexes than almost any other company.
The Federal Reserve has already raised its main interest rate to the highest level since 2001, hoping to grind down the economy and investment prices to get inflation under control. With inflation down considerably from its peak, the Fed has indicated it may cut rates three times through 2024. That would give investment prices a boost and relax the pressure on the economy and financial system.
Treasury yields have already slid on anticipation of rate cuts, and they have been holding steady. Early Wednesday, the yield on the 10-year Treasury was at 4.02%, up from 4.01% late Monday.
On Thursday, the U.S. government will give its latest monthly update on inflation at the consumer level.
On Friday, big companies in the S&P 500 will begin reporting their results for the final three months of 2023. The broad expectation is for companies in the index to report modest growth in earnings per share from a year earlier.
In other trading, a barrel of benchmark U.S. crude oil rose 37 cents to $72.61 on the New York Mercantile Exchange. Brent crude, the international standard, gained 32 cents to $77.91.
The euro slipped to $1.0928 from $1.0931.
