Published: Tuesday, May 21, 2024
HONG KONG – Asian markets mixed in cautious trade on Wednesday. Most of the region’s benchmarks rose after U.S. stock prices hit new records.
U.S. Futures rose as oil prices fell.
Tokyo’s Nikkei fell 0.6%, to 38 719.35. Japan reported that it had a higher trade deficit last month due to rising import costs outpacing an 8% increase in exports compared with the previous year. The data was weaker than expected by analysts.
Hong Kong’s Hang Seng Index gained 0.4%, to 19,288.93. EV makers led the way, including Xpeng whose shares jumped by 13.5% on Wednesday, following better than expected earnings in the first-quarter.
The Shanghai Composite index rose by less than 0.1%, to 3,158.64.
The Kospi in South Korea rose 0.1% to 2,726.35. The S&P/ASX 200 index in Australia was down less than 0.1% at 7,855.00.
Taiwan Semiconductor Manufacturing Corp. shares jumped 2.1%, boosting Taiwan’s Taiex by 1.2%.
The markets in Thailand were closed on a public holiday.
The S&P 500 gained 0.3% on Tuesday to 5,321.41, surpassing its previous record from last week. Nasdaq Composite gained 0.2%, to 16,832.62, just a day after it set its new all-time record. The Dow Jones Industrial Average rose 0.2% to 39.872.99, just below the high it reached last week.
Recent indexes have reached new records, mainly due to the expectation that the Federal Reserve will reduce interest rates this year when inflation slows down. The market has also been boosted by reports that show big U.S. corporations earning more than expected.
Macy’s has joined the chorus of companies that have delivered a higher profit than analysts had expected for the last quarter. Its stock rose 5.1% after some initial fluctuations.
Lam Research, a supplier to the semiconductor industry, also supported the market when it announced a plan to buy up to $10 billion worth of its own shares. The company announced that it would undergo a 10:1 stock split. This will lower the price of each share and make them more affordable for more investors. Its stock increased 2.3%.
This helped to offset a drop of 3.7% for Palo Alto Networks. The cybersecurity company reported a higher profit than analysts expected but gave a revenue forecast range that was just a little below analyst expectations.
Trump Media & Technology Group (the company behind Donald Trump’s Truth Social network) fell 8.7% after disclosing a loss of $327.6 millions in its first quarter report as a public company.
Lowe’s dropped 1.9%, despite better than expected results in the last quarter. It maintained its revenue forecast this year. This includes a drop of up to 3 percent for an important under-the-hood sales figure due to high interest rates.
The Federal Reserve keeps its interest rate at its highest level in over two decades. This has led to higher rates for mortgages and credit cards. The Federal Reserve is trying to walk a tightrope, whereby it keeps its main interest rate at the highest level in more than two decades.
The market is likely to be most affected by upcoming reports on profit.
The week’s headliner is Nvidia, whose stock has rocketed higher amid a frenzy around artificial-intelligence technology. Expectations are high as it will announce its latest quarterly results Wednesday.
Target will also report later that day, with Ross Stores reporting after Thursday. They may provide more information on the state of spending in the United States. The pressure on them has increased amid high inflation and seems to be most intense on their lowest-income clients.
Other trading saw benchmark U.S. Crude fall 61 cents to $78.05 a barrel on electronic trading at the New York Mercantile Exchange. Brent crude, which is the international standard, fell 64 cents to $72.24 per barrel.
The U.S. Dollar increased to 156.30 Japanese Yuen from 156.16 Japanese yen. The euro was almost unchanged at $1.0856.