Nikkei Leads Declines
Asian equities traded lower on Friday morning as global markets paused after several weeks of sharp rallies. Investors appeared cautious following Wall Street’s mild correction on Thursday, where all three major U.S. indices ended slightly lower. The S&P 500 slipped 0.3%, the Dow Jones lost 0.5%, and the Nasdaq edged down 0.15%, signaling consolidation after a rally driven by optimism over potential Federal Reserve rate cuts.
In Asia, Japan’s Nikkei 225 led regional losses, falling around 1%. The decline came after economic data showed producer prices for September rising faster than expected, reinforcing speculation that inflation remains elevated enough to delay any monetary policy easing by the Bank of Japan.
Meanwhile, Hong Kong’s Hang Seng Index fell roughly 0.8%, and China’s Shanghai Composite dropped about 0.5%, as concerns persisted over China’s slowing economic recovery and weakness in the property sector.
In commodities, gold prices retreated around 2.4% after a strong rally in the previous session, suggesting profit-taking amid a firmer U.S. dollar.
On the foreign exchange market, the U.S. dollar weakened against the yen to ¥152.74 but slightly strengthened versus the euro, which hovered around $1.1572. The movement reflected investors’ efforts to balance risk and reward ahead of key inflation data releases from both the U.S. and Asia next week.
Asia Midday Highlights
- Asian stocks generally declined on Friday as Wall Street paused its recent sharp rally.
- In Japan, Nikkei 225 fell ~2% to 47,530 as September’s Producer Price Index (PPI) came in higher than expected.
- In Hong Kong, Hang Seng slid ~0.8%, while Shanghai Composite dropped ~0.5%.
- In the U.S., the main indices closed slightly lower: S&P 500 -0.3%, Dow Jones -0.5%, Nasdaq -0.1%.
- Gold also fell about 2.4% after a strong surge, slipping back below $4,000/oz and hitting an intraday low of $3,946/oz.
- U.S. Treasury yields remained relatively stable, as both stock and bond markets appeared to take a breather after sharp recent gains.
- Crude oil (WTI) edged higher to $61.61 per barrel.
- In currencies, the U.S. dollar weakened against the Japanese yen (from ¥153.05 to ~¥152.74), while the euro strengthened to around $1.1572.
By Ade Yunus
Global Market Strategies