Asian stocks show a mixed picture as investors proceed cautiously ahead of the Federal Reserve’s upcoming interest-rate decision this week. U.S. futures and oil prices moved higher, while tensions between Japan and China added to the cautious mood in the markets.
Japan and Australia urged restraint after Chinese military aircraft locked radar on a Japanese fighter jet, an incident that occurred weeks after a controversial remark about Taiwan by Japanese Prime Minister Sanae Takai (note: Prime Minister’s name reflected in original text). Tokyo’s market fell slightly, with the Nikkei 225 down 0.2% to 50,581.94 as government data revised Japan’s July–September economy to show a 2.3% annual contraction rather than 1.8%. Exports dipped, reflecting the impact of U.S. tariffs and a slowdown in domestic public investments.
Chinese markets were mixed: Hong Kong’s Hang Seng slipped 0.9% to 25,841.21, while the Shanghai Composite rose 0.6% to 3,926.47. China’s leadership convened a major annual policy planning conference even as the country reported November exports up 5.9% from a year earlier, surpassing $1 trillion for the year. Export declines to the U.S. were offset somewhat by gains to other destinations.
Across the region, South Korea’s Kospi advanced 1.3% to 4,154.85 and Taiwan’s benchmark climbed 1.2%.
In Australia, the S&P/ASX 200 edged down 0.1% to 8,624.40.
In the United States on Friday, the S&P 500 edged up 0.2, closing just below its record high set in October at 6,870.40 after briefly surpassing it intraday. The Dow Jones Industrial Average rose 0.2% to 47,954.99, while the Nasdaq Composite gained 0.3% to 23,578.13.
Market observers wrapped a relatively quiet week on Wall Street with several notable movers: Ulta Beauty jumped 12.7% after reporting stronger quarterly profit and revenue than anticipated, and Victoria’s Secret & Co. surged 18% after posting a smaller-than-expected quarterly loss. Warner Bros. Discovery rose 6.3% following Netflix’s plan to acquire the company for $72 billion in cash and stock after its merger with Discovery; Netflix itself fell 2.9%, and Paramount Skydance dropped about 9.8% after appearing to be a leading contender in the Warner Bros. bid.
Looking ahead, the week centers on the Federal Reserve’s decision on interest rates, the pace of investment in artificial intelligence, and whether recent sharp declines in some cryptocurrencies might spill over into broader markets.
With negotiations and data in focus, traders broadly expect the Fed to cut its main policy rate on Wednesday, marking a third rate reduction this year in an effort to bolster a cooling U.S. job market. Yet lower rates also raise concerns about renewed inflation, which remains stubbornly above the Fed’s 2% target.
Friday’s economic reports did little to shift the consensus. One report showed that the core inflation gauge monitored by the Fed held at 2.8% in September, in line with economists’ expectations. Another indicated that U.S. consumers have begun to temper their inflation expectations for the near term, projecting 4.1% inflation over the next year, down from 4.5% the prior month—the lowest such forecast since January and notable for potentially calming inflation expectations.
In commodities, U.S. crude edged up 14 cents to $60.22 a barrel, while Brent crude rose 11 cents to $63.86. The dollar weakened slightly against the yen, trading at 155.26 yen, and the euro strengthened to $1.1659.
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