Asian Shares Mixed As Inflation Fears Return To Haunt

(RTTNews) - Asian stocks ended mixed on Wednesday as upbeat U.S. economic data released overnight led investors to scale back Fed rate cut bets.

Fed Bank of Atlanta President Raphael Bostic said on Tuesday that officials should be cautious with policy decisions, given uneven progress on lowering inflation.

Gold ticked higher in Asian trade as the dollar consolidated ahead of the release of minutes of the Fed's December policy meeting and ADP employment data.

Oil prices inched up for a second straight session as supplies from Russia and OPEC members tightened and the American Petroleum Institute reported a large crude draw.

China's Shanghai Composite index finished marginally higher at 3,230.17 after a choppy session as regulators announced plans to broaden the scope of home appliance trade-ins that qualify for subsidies.

Hong Kong's Hang Seng index fell 0.86 percent to 19,279.84 as the yuan fell to its lowest level since September 2023 despite renewed efforts by the country's central bank to support the currency. Tech giant Tencent Holdings fell 2.7 percent to extend declines from the previous session.

Japanese markets edged lower due to concerns around inflation and interest rates. The yen sagged close to levels that drew intervention last year undermined by the BoJ rate hike uncertainty.

The Nikkei average dipped 0.26 percent to 39,981.06 while the broader Topix index settled 0.59 percent lower at 2,770.

Fast Retailing, Uniqlo's parent company, dropped half a percent ahead of its first-quarter results due on Thursday.

Chip stocks bounced back in an otherwise subdued market, with Advantest rallying 3.4 percent and Tokyo Electron gaining 1.6 percent.

South Korea's Kospi average ended up 1.16 percent at 2,521.05, extending gains for a fourth straight session.

Heavyweight Samsung Electronics surged 3.4 percent as Nvidia CEO Jensen Huang expressed confidence that the Asian company could develop a new design on high-bandwidth memory chips.

Australian markets rose as a drop in the core inflation rate bolstered the case for a cut in interest rates by RBA as early as next month.

The benchmark S&P/ASX 200 climbed 0.77 percent to 8,349.10, extending its winning streak for the fifth consecutive day.

The broader All Ordinaries index closed up 0.66 percent at 8,599.40, led by banks and consumer-exposed stocks. Tech stocks tracked their U.S. peers lower, with ZIP tumbling 4.9 percent and Block falling 3.3 percent.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index finished marginally higher at 13,043.11.

U.S. stocks fell overnight as inflation and interest rate concerns returned to the fore after the release of upbeat economic data.

The tech-heavy Nasdaq Composite slumped 1.9 percent, the S&P 500 lost 1.1 percent and the narrower Dow shed 0.4 percent as the yield on the benchmark ten-year note surged to an eight-month high.

U.S. service sector growth picked up in December, a measure of prices paid for inputs rose to near a two-year high, and job openings unexpectedly increased in November, prompting traders to push back their expectations on when the Fed can cut interest rates this year.