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Fed looms as Asian stocks rise

Asian equities mostly rose on Wednesday ahead of the Federal Reserve’s interest rate decision tonight, with Japan’s Nikkei 225 reaching a record high as chipmakers and industrial stocks advanced on strong trade data. US stocks ended mixed on Tuesday, with the Dow Jones Industrial Average closing at a record high while the S&P 500 and Nasdaq 100 fell as investors rotated out of technology shares and awaited the Fed’s policy announcement. European equities also closed higher on Tuesday after German investor sentiment rebounded more strongly than expected. Gold prices were little changed on Wednesday, while oil continued to fall.

  • Date
  • Auteur Shane Strowmatt, Senior Investment Writer
  • Temps de lecture 5 minutes

Fed interest rate pause
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Asian equities mostly rose on Wednesday, with Japan’s Nikkei 225 gaining 0.8% to trade at a new record high. Japanese shares were supported by chipmakers and industrial stocks, as trade data released on Wednesday showed stronger-than-expected export growth in May and a smaller trade deficit, driven by AI-related electronics and semiconductor demand. Elsewhere in the region, Singapore stocks hit a record high, Korea’s Kospi gained 1.3% and Australia’s S&P/ASX 200 was up 0.5%. Hong Kong’s Hang Seng Index was trading 0.8% lower, while mainland China’s CSI 300 rose 0.4% and India’s Nifty 50 gained 0.4%.

Dow rises as tech retreats

US stocks ended mixed on Tuesday, with the Dow Jones Industrial Average rising 0.6% to a record 51,999.67 points, while the S&P 500 fell 0.6% to 7511.35 and the Nasdaq 100 dropped 1.9% to 29,968.13. The Dow was supported by easing inflation concerns as oil prices continued to fall after the US and Iran agreed on a framework to end the war, while technology shares came under pressure from profit-taking after their recent strong rally. Investors also looked ahead to the Federal Reserve’s policy decision on Wednesday, when economists expect Fed Chair Kevin Warsh to leave interest rates unchanged at his first meeting since taking office in May. Among notable movers, SpaceX gained 4.8% after its blockbuster listing, while chipmakers Intel and Marvell Technology slumped 8.5% and 9.8%, respectively.

German ZEW sentiment rebounds

The German ZEW Indicator of Economic Sentiment rose by 20.7 points to 10.5 in June from minus 10.2 in May, according to data released on Tuesday. ZEW said investor confidence improved as financial market experts expected the conflict with Iran to ease, potentially reducing pressure on energy costs and inflation while supporting domestic demand. The assessment of Germany’s current conditions weakened to minus 81 points from minus 77.8 in May, while euro-area expectations climbed to 9.5 points from minus 9.1. European equities closed higher on Tuesday, with the Euro Stoxx 50 rising 0.4%, while Switzerland’s SMI gained 0.3%.

Corporate and economic calendar

Corporate news in focus: There is no major corporate news scheduled today.

Economic data in focus: UK Consumer Price Index (08:00), SECO Swiss economic forecast (09:00), euro-area Consumer Price Index (11:00), European Central Bank President Christine Lagarde speaks (12:50), US retail sales (14:30), Federal Reserve interest rate decision (20:00).

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Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.