Hang Seng Index retreats in face of rate hike
Shares edged up in Asia on Thursday as investors bet the US Federal Reserve is finally getting the jump on inflation, delivering its first rate hike in more than three years and calming a global bond selloff that had sent long-term yields soaring. In Hong Kong, the benchmark Hang Seng Index opened down 233 points, or 0.94 percent, at 24,480. The tech index fell 44 points, or 1.03 percent, to…
Shares surged in Asia Thursday as traders anticipated the US Federal Reserve's first interest rate hike in over three years, signaling progress in the fight against inflation. In Hong Kong, the Hang Seng Index began the day with a decline of 233 points, or 0.94 percent, to 24,480. The technology index experienced a further drop, falling 44 points, or 1.03 percent, to 4,281.
Meanwhile, the China Enterprises Index slipped by 79 points, or 0.97 percent, to 8,127. In Beijing, the Shanghai Composite Index opened 14 points, or 0.38 percent, lower at 3,877. The Shenzhen Component Index followed suit, decreasing by 44 points, or 0.33 percent, to 13,409, while the ChiNext Index edged down 14 points, or 0.43 percent, to 3,297.
Tokyo's Nikkei Index showed signs of recovery, opening 720 points, or 1.13 percent, higher at 64,643 but later settling 64 points, or 0.10 percent, above its opening at one point during the day. Seoul's Kospi Index mirrored the Nikkei's performance, opening 61 points, or 0.91 percent, higher at 6,779 before modestly increasing. Market openings occurred as the US dollar reached a seven-week peak against its major counterparts, bolstered by rising short-term Treasury yields and widespread expectations of another Fed rate hike by December.
This increased market sentiment contributed to a bearish trend for commodities, as oil prices receded. The Bank of England was expected to maintain interest rates later in the day, but speculation centered on potential energy price pressures that might force a November hike. The Bank of Japan was expected to raise rates on Friday, as anticipated.
The Federal Reserve's unanimous decision to raise interest rates by a quarter point overcame hopes for a pause, with several analysts predicting additional hikes this year. Goldman Sachs forecasted the likelihood of a further rate increase in October, citing the data supporting a return to the 2 percent target. Commodity markets suffered, with Brent crude futures falling 0.7 percent to $105.05 a barrel after a 2.7 percent drop overnight due to reports of Saudi Arabia offering crude shipments through Oman, alleviating concerns about Middle East supply disruptions.
Written by urgent.news from RTHK News - Finance's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
