Asian stocks mixed ahead of Fed chairman’s speech

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Jerome Powell

FILE – In this July 31, 2019, file photo Federal Reserve Chairman Jerome Powell speaks during a news conference following a two-day Federal Open Market Committee meeting in Washington. Powell is scheduled to speak at the annual Fed conference in Jackson Hole, Wyo., on Friday, Aug. 23. (AP Photo/Manuel Balce Ceneta, File)

BEIJING (AP) — Asian stock markets were mixed on Friday after Wall Street declined ahead of a closely watched speech by the U.S. Federal Reserve chairman.

Market benchmarks in Shanghai, Tokyo and Australia rose while Hong Kong declined.

Investors are looking to Jerome Powell’s speech Friday for signs of direction on interest rates after two regional Fed presidents said they see no need for a change.

Investors expect a cut in September, the Fed’s second in three months, to shore up U.S. economic growth amid a tariff war with Beijing and weakening global growth.

“Markets seem very clearly positioned for some very dovish guidance from Mr Powell,” Jeffrey Halley of Oanda said in a report. “It is a dangerous assumption to make.”

Tokyo’s Nikkei 225 climbed 0.2 % to 20,672.86 and the Shanghai Composite Index rose 0.4% to 2,894.22. Hong Kong’s Hang Seng fell 0.3% to 26,132.71.

Sydney’s S&P-ASX 200 added 0.2% to 6,515.40. South Korea’s Kospi was little-changed at 1,951.16 while New Zealand, Taiwan and Southeast Asian markets declined.

On Wall Street, stocks gave up an early gain and wavered through much of the day before closing mostly lower.

The Standard & Poor’s 500 index fell 0.1% to 2,922.95.

A pickup for Boeing helped drive the Dow Jones Industrial Average higher. The Dow gained 0.2%, to 26,252.24.

The Nasdaq dropped 0.4% to 7,991.39.

Losses by health care, technology and energy companies, among other sectors, outweighed gains by banks, consumer goods makers and elsewhere in the market. Bond prices fell, nudging yields higher.

Minutes from the Fed’s July meeting released Wednesday provided little clarity on what the future course for rates will be.

Esther George, president of the Fed’s Kansas City regional bank, and Philadelphia Fed President Patrick Harker said in televised interviews they see no need for another rate cut.

George and Eric Rosengren, president of the Boston Fed, dissented from the 8-2 rate cut vote, arguing that they favored no rate cut at all.

Investors predict a 91.2% likelihood that the Fed will cut its benchmark rate by a quarter-point next month, according to the CME Group, which tracks investor bets. That is down from 98.5% the day before.

Investors worried that uncertainty over the U.S.’s escalating trade war with China could cause the economy to stumble, hurting corporate profits.

The Trump administration has imposed a 25% tariff on $250 billion in Chinese imports. A pending 10% tariff on another $300 billion in goods would hit everything from toys to clothing and shoes that China ships to the United States, however some 60% of the new tariffs wouldn’t go into effect until mid-December, and others were taken off the table altogether.

ENERGY: Benchmark U.S. crude gained 12 cents to $55.47 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 33 cents on Thursday to close at $55.35. Brent crude, used to price international oils, advanced 19 cents to $60.11 in London. It shed 38 cents the previous session to $59.92.

CURRENCY: The dollar dropped to 106.55 yen from Wednesday’s 106.42 yen. The euro shed to $1.1073 from $1.1082.

Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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