Asian Shares Drift Lower After Fed's Hawkish Rate Cut

(RTTNews) - Asian stocks ended mostly lower on Thursday following a slightly hawkish leaning policy decision from the Federal Reserve.

Investors reacted to hawkish comments from Fed Chair Powell, who said higher goods prices are feeding through to inflation and that the FOMC expects inflation to continue to build into next year.

Chinese shares fell sharply, with trade tensions in focus after China's internet regulator banned domestic tech companies from purchasing Nvidia's RTX Pro 6000D chips.

Separate reports revealed that China has decided to end an antitrust investigation into the dominance of Google's Android in the world's largest smartphone arena.

The benchmark Shanghai Composite index ended down 1.15 percent at 3,831.66 ahead of a phone call between U.S. President Donald Trump and Chinese President Xi Jinping scheduled for Friday.

Hong Kong's Hang Seng index fell 1.35 percent to 26,544.85 after China's central bank left its key interest rate unchanged.

Japanese markets rallied on optimism about the economy. The Nikkei average climbed 1.15 percent to 45,303.43, ending above the 45,000 line for the first time, led by heavyweight technology and semiconductor-related shares on hopes for robust artificial intelligence demand.

The broader Topix index settled 0.41 percent higher at 3,158.87 and the yen pulled back from a two-month high after veteran lawmaker and fiscal dove Sanae Takaichi said she will run in the ruling Liberal Democratic Party's leadership election.

Seoul stocks set a new record high despite a mixed close on Wall Street overnight. The Kospi average jumped 1.40 percent to 3,461.30, with auto and technology stocks pacing the gainers.

Market bellwether Samsung Electronics surged 2.9 percent to 80,500 won, breaching the 80,000-won threshold for the first time in 13 months on expectations of improved earnings amid rising memory chip prices. Its chipmaking rival SK Hynix soared 5.9 percent.

Australian markets hit a two-week low after the release of lackluster August employment data. The benchmark S&P/ASX 200 ended 0.83 percent lower at 8,745.20, dragged down by mining and energy stocks. The broader All Ordinaries index dropped 0.70 percent to 9,030.90.

Oil & gas producer Santos tumbled 11.90 percent after a consortium led by Abu Dhabi National Oil Company withdrew its $18.7 billion offer to buy the company. Woodside Energy Group shares slumped 6.3 percent.

New Zealand stocks ended sharply lower and the kiwi dollar skidded after data showed GDP shrank more than expected in the second quarter. The benchmark S&P/NZX-50 index fell 0.82 percent to 13,120.03, deepening losses from the previous session.

Gold extended declines in Asian trade as the dollar gained following the Fed's widely expected interest-rate decision. Oil prices dipped after data showed an increase in U.S. fuel inventories.

U.S. stocks fluctuated before ending mixed overnight as the Fed delivered a 25-bps rate cut, citing a shift in the balance of risks, especially recent sluggishness in the labor market.

Initial enthusiasm waned and Treasury yields edged higher after Fed Chairman Jerome Powell termed the latest policy move as a "risk management cut," emphasizing it was not primarily aimed at addressing economic weakness and that the Fed is in a "meeting-by-meeting situation" regarding the outlook for interest rates.

The Dow rose 0.6 percent while the S&P 500 slid 0.1 percent and the tech-heavy Nasdaq Composite shed 0.3 percent.