The stock market day
Interest rate concerns weigh on Asian stock exchanges
8/25/2023 7:41 am
Negative guidance from Wall Street and heightened caution ahead of Fed President Jerome Powell’s speech in Jackson Hole caused the East Asian stock exchanges to end the week with some heavy losses. The positive impulses from the previous day, mainly triggered by the surprisingly strong results from Nvidia, have evaporated again. On the contrary, interest rate hike speculation is spreading again after good US economic data. They pointed to a further robust US economy, which could open up the possibility of further interest rate hikes by the US Federal Reserve.
Two Fed officials have already commented on the fringes of the symposium. Boston Fed President Susan Collins said the Fed has “more work to do” to bring inflation toward its 2 percent target and that further rate hikes are possible if data supports such a move. Conversely, Philly Fed President Patrick Harker said it’s probably a good idea to hold rates steady for the rest of the year and see how that affects the economy.
The minus is most obvious in Tokyo. For the Nikkei it’s down 1.8 percent. Technology stocks in particular show up with sales. The Hang SengIndex in Hong Kong down 1.0 percent and for the Shanghai Composite it’s down 0.5 percent. Taxes in the technology sector are also having a negative impact here.