Asian shares were mixed on Thursday following a dip in U.S. stocks due to concerns over rising inflation. Oil prices saw a slight increase while U.S. futures remained flat. South Korean shares were largely unaffected despite a significant defeat for the ruling conservative party in a parliamentary election.
The Kospi in South Korea edged slightly higher, while Tokyo’s Nikkei 225 and Hong Kong’s Hang Seng experienced minor losses. The Shanghai Composite index and Australia’s S&P/ASX 200 also saw fluctuations. Bangkok’s SET and Taiwan’s Taiex both experienced slight declines.
The recent inflation data has caused Treasury yields to rise, putting pressure on the stock market. The fear is that the Federal Reserve may delay interest rate cuts, leading to concerns for both consumers and investors. The Fed has been monitoring inflation closely, aiming for a sustainable decrease to reach its target of 2%.
Following the inflation report, prices for bonds and gold fell, with the 10-year Treasury yield jumping significantly. Traders have adjusted their expectations for Fed rate cuts, with concerns that high interest rates could potentially lead to a recession.
On Wall Street, real estate investment trusts and utility companies were among the biggest losers due to the impact of high interest rates. Real estate stocks in the S&P 500 saw significant declines, with homebuilders also experiencing losses.
As companies begin reporting their first-quarter earnings, Delta Air Lines stood out with better-than-expected results. The airline noted strong demand for flights but refrained from raising its profit forecast for the year, leading to fluctuations in its stock price.
In the commodities market, U.S. benchmark crude oil remained steady while Brent crude saw a slight increase. The U.S. dollar weakened against the Japanese yen, trading near a 34-year high, while the euro also saw a decline.
Overall, the mixed performance of Asian shares reflects the uncertainty in the market following the latest inflation data and its potential impact on the global economy. Investors will be closely watching for further developments in the coming days.
