Hong Kong stocks decline after Fed raises interest rates and signals more to come
Stocks in Hong Kong and mainland China fell on Thursday, after the US Federal Reserve raised interest rates for the first time in three years and signalled that further tightening remained on the table. The benchmark Hang Seng Index fell 0.8 per cent to 24,537.30 as of 9.30am local time. The Hang Seng Tech Index lost 0.5 per cent. On the mainland, the CSI 300 Index slipped 0.2 per cent, while the…
Hong Kong and mainland Chinese stocks slipped on Thursday following the US Federal Reserve's decision to raise interest rates for the first time in three years and hint at further tightening. The Hang Seng Index dropped 0.8 percent to 24,537.30, while the Hang Seng Tech Index declined 0.5 percent. China's CSI 300 Index fell 0.2 percent, and the Star Market 50 index remained relatively stable.
The Fed increased its benchmark interest rate by 0.25 percentage points to a range of 3.75 percent to 4 percent, aiming to bring inflation to 2 percent and restore its credibility. Chair Kevin Warsh emphasized the need to achieve this target. A recent dot plot indicated one more rate hike this year. Despite expectations of an increase, equities had been fluctuating as investors prepared for tighter monetary policy.
Resilient corporate earnings and the artificial-intelligence boom partially offset headwinds like bond sell-offs and energy shocks from the US-Israel war on Iran. Moving forward, investors will focus on Japan's upcoming rate decision on Friday, where the central bank is expected to lift borrowing costs by 0.25 percentage points to a 31-year high of 1.25 percent.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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