Asian Markets Mixed as Investors Weigh Fed Pause, Earnings and Currency Moves

BY COMFORT OGBONNA

Asian shares were mixed on Thursday as investors across the region adopted a cautious, wait-and-see approach following the U.S. Federal Reserve’s decision to leave its key interest rate unchanged. The outcome was widely anticipated, and Fed Chair Jerome Powell reinforced the market’s expectations by saying policymakers believe interest rates are “in a good place” for now, offering little immediate guidance on the timing of any future cuts.

While equity markets showed limited direction, movements in commodities and currencies were more pronounced. Gold surged another 4.6% to trade around $5,545 per ounce, extending a powerful rally as investors continued to seek protection against uncertainty. Silver also climbed sharply, rising 4.1%. In currency markets, the U.S. dollar weakened against the Japanese yen, while oil prices moved higher, reflecting shifting expectations around growth, inflation and monetary policy.

In Japan, gains among select technology firms reporting solid earnings were not enough to significantly lift the broader market. The Nikkei 225 edged up by less than 0.1% to 53,375.60, as advances were offset by declines in other heavyweight stocks. Computer chip testing equipment maker Advantest jumped 5.2% after posting earnings that exceeded expectations, highlighting ongoing strength in parts of the semiconductor supply chain. Other technology-related shares were mixed, with Panasonic Holdings slipping, while chipmaker Kioxia Holdings Corp. and Sony Corp. posted gains.

Attention in Japan is increasingly turning to the upcoming earnings season, which is set to gather pace next week. Major companies including Toyota Motor Corp., Sony Corp. and Nintendo Co. are scheduled to report their results, and investors are watching closely for insights into global demand, currency impacts and the outlook for consumer and industrial spending.

Elsewhere in Asia, South Korea’s Kospi rose 1.0% to 5,221.25, marking a fresh record high. The index was boosted by a strong performance from SK Hynix, which gained 2.4% following a robust earnings report that reinforced optimism around memory chips and artificial intelligence-related demand.

In China and Hong Kong, markets posted modest gains. Hong Kong’s Hang Seng Index added 0.3% to 27,917.12, while the Shanghai Composite Index rose 0.2% to 4,157.98, as investors balanced hopes for policy support with ongoing concerns about growth momentum. In Australia, the S&P/ASX 200 slipped nearly 0.1% to 8,927.50, reflecting subdued sentiment across sectors.

Indonesia stood out as a notable underperformer. In Jakarta, the JSX index fell 2.4%, extending a sharp decline after MSCI, a U.S.-based provider of global equity, fixed income and real estate indices, warned about rising market risks in the country. The warning weighed heavily on investor confidence and added to recent volatility.

Overnight in the United States, the market reaction to the Fed’s decision was muted. The S&P 500 slipped by less than one point to 6,978.03. The Dow Jones Industrial Average rose 12 points, or less than 0.1%, to 49,015.60, while the Nasdaq Composite gained 0.2% to 23,857.45.

Individual stocks, however, saw sharper moves. Seagate Technology surged 19.1%, marking the biggest gain in the S&P 500, after the data-storage company reported quarterly profits that exceeded analyst expectations. Nvidia, often viewed as a bellwether for the artificial intelligence boom, climbed 1.6% and provided the strongest single boost to the S&P 500. Apple, by contrast, slipped 0.7%, making it the heaviest drag on the benchmark index.

In foreign-exchange trading, the U.S. dollar steadied after Treasury Secretary Scott Bessent said in a CNBC interview that the U.S. government is not intervening in currency markets and continues to favor a “strong dollar.” The dollar eased slightly to 153.35 Japanese yen from 153.42 yen, while the euro rose to $1.1972 from $1.1955.

Market analysts noted that subtle shifts in currency policy signals are being closely watched on both sides of the Pacific. Stephen Innes, managing partner at SPI Asset Management, said that a modestly firmer yen suits U.S. manufacturing interests, while any acknowledgment from the Fed provides Tokyo with valuable time and credibility.

Bond markets were largely stable, with the yield on the benchmark 10-year U.S. Treasury holding at 4.24%, unchanged from late Tuesday.

The Fed has already cut interest rates several times over the past year in an effort to support the labor market, but inflation remains stubbornly above its 2% target. Policymakers remain cautious that cutting rates too aggressively could reignite price pressures, even as lower borrowing costs would provide a boost to economic activity. Lower rates could also further weaken the U.S. dollar, offering relief to exporters. Former President Donald Trump has been vocal in pressing for more aggressive rate cuts.

In energy markets, oil prices advanced. Benchmark U.S. crude rose $1.17 to $64.39 per barrel, while Brent crude, the international benchmark, gained $1.25 to $69.65 per barrel, reflecting improved sentiment around global demand and geopolitical factors.