Asian shares traded mixed on Tuesday, following a rebound on Wall Street, which recovered some losses after the market’s steepest decline in nearly 18 months.
Japan’s Nikkei 225 edged up 0.2% to 36,282.25 by the afternoon. Meanwhile, Australia’s S&P/ASX 200 advanced by 0.4%, reaching 8,021.10. In contrast, South Korea’s Kospi dropped 0.3%, settling at 2,529.02, while Hong Kong’s Hang Seng Index rose 0.4% to 17,270.12. The Shanghai Composite dipped slightly, down 0.2% to 2,729.86.
Investor Focus Shifts to Inflation Data
This week, investors are awaiting key monthly inflation reports at both the consumer and wholesale levels, which are expected to provide clearer signals on the direction of global monetary policy.
In the U.S., the Federal Reserve has been maintaining high interest rates to combat inflation. However, it is widely anticipated that the Fed may begin lowering rates later in September, which would alleviate some economic pressure. As the Fed shifts its focus, there is growing concern about balancing inflation control with job market protection and recession risks.
Wall Street Rebounds After Steep Losses
U.S. Stock Market Sees Gains
Monday’s trading on Wall Street saw significant gains, though the recovery did not fully offset the previous week’s sharp losses. The S&P 500 surged by 1.2% to close at 5,471.05, marking a positive shift after a four-day losing streak. The Dow Jones Industrial Average also climbed 1.2%, reaching 40,829.59, while the tech-heavy Nasdaq composite rose by the same percentage to 16,884.60.
Boeing Reaches Tentative Union Deal
A key driver of Monday’s rally was Boeing, which surged 3.4% following news of a tentative agreement with its largest union. If ratified, the deal would prevent a potential strike, safeguarding Boeing’s aircraft production. The proposed contract offers 33,000 workers represented by the International Association of Machinists and Aerospace Workers a 25% pay raise over four years.
Nvidia and Big Tech Lead Market Recovery
Tech giant Nvidia was another major contributor to the day’s gains, jumping 3.5%. This marked a sharp reversal for the company, which had plummeted 13.9% the previous week. Nvidia’s rise helped lift the S&P 500, as Big Tech resumed its dominant role in driving the market higher.
Apple, however, remained relatively unchanged. The company revealed its latest iPhone model, the iPhone 16, which is designed to leverage artificial intelligence and promises significant upgrades to its virtual assistant, Siri.
Bond Market and Energy Prices Reflect Market Sentiment
Bond Yields Show Slight Movement
In the bond market, the yield on the 10-year U.S. Treasury note slightly decreased, moving to 3.71% from 3.72% at the end of last week. Bond yields remain closely watched as they influence borrowing costs across the economy.
Oil Prices Dip
In energy markets, U.S. crude oil prices slipped by 19 cents to $68.52 per barrel. Meanwhile, Brent crude, the global benchmark, decreased by 15 cents, trading at $71.69 a barrel. The modest declines in oil prices come as traders continue to assess the balance between supply constraints and demand signals.
Currency Movements Reflect Cautious Trading
U.S. Dollar Softens Against Yen
The U.S. dollar eased slightly against the Japanese yen, trading at 143.09 yen, down from 143.15 yen. The euro remained stable, trading at $1.1041, showing little change from $1.1040 in previous sessions.
As investors await upcoming inflation data, markets remain cautious. The outcome could have significant implications for future monetary policy moves in the U.S. and other global economies.
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