Asian shares mostly rose on Thursday following a strong finish on Wall Street, fueled by expectations of U.S. interest rate cuts this year. Japan’s Nikkei 225 climbed 0.8%, Sydney’s S&P/ASX 200 rose 0.5%, and South Korea’s Kospi added 1.3%.
Analysts are optimistic that Taiwan Semiconductor Manufacturing Co’s (TSMC) facilities will receive quicker relief after a powerful earthquake struck, easing concerns about production halts. Trading in Taiwan was closed for national holidays.
Market participants found comfort in the weaker-than-expected U.S. services purchasing managers index, offsetting the surprise rebound in manufacturing activities earlier in the week. This suggests that overall demand may remain subdued for the Federal Reserve’s inflation fight.
On Wall Street, the S&P 500 edged up, with GE Aerospace leading the gains after splitting off its power and energy business. However, Intel saw a significant drop after disclosing financial details about its money-losing foundry business.
Stocks have slowed down after a significant rally, with concerns rising about the Fed’s ability to deliver as many interest rate cuts as hoped. The Fed has indicated it may cut rates three times this year, depending on inflation data.
Traders are awaiting the U.S. government’s comprehensive job market report for March, which will likely be the week’s headline economic data. Expectations for Fed rate cuts have been reduced, aligning with Fed officials’ views. Bond yields fell, and in energy trading, benchmark U.S. crude rose slightly.