Tokyo, Aug 6 (AP) — Asian markets experienced mostly positive trading on Wednesday, following declines on Wall Street due to concerns about the U.S. economy.
Investors are evaluating numerous corporate earnings to determine the impact of U.S. President Donald Trump's tariffs on businesses.
This week, major Japanese companies, including automakers Honda Motor Co. and Toyota Motor Corp., as well as electronics and entertainment giant Sony Corp., are scheduled to report their fiscal first-quarter results.
Japan's Nikkei 225 index increased by 0.6% to 40,777.45. Likewise, Australia's S&P/ASX 200 grew by 0.6% to 8,822.90. However, South Korea's Kospi fell by 0.3% to 3,187.57. Meanwhile, Hong Kong's Hang Seng improved by 0.2% to 24,947.57, and the Shanghai Composite climbed 0.3% to 3,627.54.
U.S. futures saw a 0.3% rise.
On Tuesday, the S&P 500 dropped 0.5% to 6,299.19, following a volatile stretch where it switched from its worst performance since May to its best. The Dow Jones Industrial Average slipped 0.1% to 44,111.74, whilst the Nasdaq Composite tumbled 0.7% to 20,916.55.
A report indicating lower than expected activity in U.S. service industries such as transportation and retail intensified concerns about the economic impact of Trump's tariffs. However, these concerns have also sparked hopes that the Federal Reserve might cut interest rates. Combined with stronger-than-expected earnings from U.S. companies, this has helped moderate the losses. Notably, the S&P 500 is still just 1.4% below its record high.
The current environment places pressure on companies to deliver greater profits, particularly as the U.S. stock market has hit multiple record highs since April. To make stock prices appear more attractive, companies could increase profits, or the Federal Reserve could lower interest rates. Expectations for a rate cut have increased, especially after a weaker-than-anticipated labor market report on Friday. Reduced interest rates could enhance the appeal of stocks by lowering costs and invigorating the economy, though there is a risk of increased inflation.
Since the release of Friday’s jobs report, Treasury yields have fallen significantly and have yet to bounce back. The yield on the 10-year Treasury slid to 4.19% from 4.22% as of late Monday and from 4.39% just prior to the jobs report release — a notable shift for the bond market.
In the energy sector, benchmark U.S. crude rose by 41 cents to reach $65.57 per barrel. Brent crude, the international benchmark, climbed 42 cents, reaching $68.06 per barrel.
In currency markets, the U.S. dollar decreased to 147.34 Japanese yen from 147.61 yen. Meanwhile, the euro rose slightly to $1.1583 from $1.1579. (AP) GSP
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