Asian stocks were mostly lower on Wednesday as markets digested Japanese and Australian business data, after U.S. stocks remained relatively flat as the earnings season for major companies intensified.
US futures fell while oil prices rose.
Japan’s benchmark Nikkei 225 average fell 0.2 percent in morning trade to 39,508.84, with the yen trading at its highest level in months ahead of the Bank of Japan’s monetary policy decision next week.
The US dollar was trading at 162 yen earlier this month, but the Japanese currency has strengthened in recent days after officials intervened to stem the yen’s slide. Expectations that the Bank of Japan may raise interest rates from near zero and that the US Federal Reserve may cut them in turn have helped support the yen, which has been weakening as the gap between US and Japanese interest rates has widened.
Early Wednesday morning, the dollar was trading at 154.78 yen, down from 155.59 yen late Tuesday.
Factory activity in Japan contracted in July as weak demand weighed on the manufacturing sector, a business survey showed on Wednesday. Services rose, helping to drive growth in overall private sector activity in Japan.
Elsewhere in Asia, Hong Kong’s Hang Seng Index fell 0.6% to 17,370.09, led by the Hang Seng Technology Index which fell 0.9%. The Shanghai Composite Index was almost unchanged at 2,915.46.
Australia’s S&P/ASX 200 rose 0.1% to 7,973.20 after the services sector saw weaker growth in July. Manufacturing improved slightly but remained in contractionary territory.
South Korea’s Kospi fell 0.3% to 2,772.55, with Samsung Electronics Co Ltd dropping 1.1% after talks between the company and its largest labor union ended without a deal. Earlier this month, workers declared an indefinite strike. He hits To pressure the company to accept their calls for increased wages and other benefits.
The S&P 500 fell 0.2% to 5,555.74 on Tuesday. The Dow Jones Industrial Average fell 0.1% to 40,358.09, and the Nasdaq Composite dropped 0.1% to 17,997.35.
But the smaller stocks in the Russell 2000 continued their big rally, rising 1%. These stocks have recently upended the market’s leaderboard, rising sharply on hopes of interest rate cuts in the near future.
Mixed trading came with dozens of Companies Report it Spring resultswith Alphabet and Tesla leading the way after the close of trading for the day. Expectations are high, with analysts widely expecting the strongest earnings growth for S&P 500 companies since late 2021, according to FactSet.
UPS, one of the S&P 500’s heavyweights, fell 12.1% after posting weaker-than-expected earnings and revenue in the spring.
But Chief Executive Carol Tomé said the company’s U.S. business delivered more packages than the previous year. First such growth In nine quarters, he called it “a significant turning point for our company.”
Nvidia The stock was the most powerful drag on the S&P 500. Its 0.8% loss on the day was relatively modest, but the S&P 500 gives greater weight to larger stocks, and Nvidia is worth more than $3 trillion.
This is despite the fact that high mortgage rates have frozen the housing industry. A report released Tuesday showed Previously occupied home sales fell In June, sales of previously occupied homes fell to record lows, compared with economists’ expectations. According to the National Association of Realtors, sales slowed in part because prices of previously occupied homes hit an all-time high.
Times may be easier ahead for interest rates. With inflation slowing, many expect the Federal Reserve to begin cutting its key interest rates in September. That should provide some relief to the economy and financial markets after the Fed kept the federal funds rate at its highest level in more than two decades.
In other trading, the price of benchmark U.S. crude oil rose 31 cents to $77.27 a barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the global benchmark, rose 34 cents to $81.35 a barrel.
The euro fell to $1.0845 from $1.0855.
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Associated Press business writer Stan Choi contributed.
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