TOKYO — Asian stocks experienced a downturn on Thursday, following a stagnant session on Wall Street, where the S&P 500 continued its record-setting trend.
Concerns surrounding U.S. tariff policies are significantly impacting investor sentiment across the region.
Japan’s Nikkei 225 index dropped 1.2%, closing at 38,678.04. Australia’s S&P/ASX 200 fell by 1.2% to 8,322.80, while South Korea’s Kospi experienced a nearly 0.7% decrease, ending at 2,654.06.
Hong Kong’s Hang Seng index declined 1.3% to 22,640.18, after China’s decision to maintain its benchmark interest rate in an effort to ensure financial stability. The Shanghai Composite saw a slight decline, shedding less than 0.1% to close at 3,349.60.
“The yuan is under significant pressure, with a notable surge in foreign-exchange outflows last month, as tariff discussions created turbulence in the markets,” said an industry expert.
On Wall Street, the S&P 500 saw a modest increase of 0.2% after reaching an all-time high the previous day. Similarly, the Dow Jones Industrial Average rose by 71 points, or 0.2%, while the Nasdaq composite increased by 0.1%.
Microsoft was a key contributor to the S&P 500’s rise, with a 1.3% gain following its announcement of developing a groundbreaking “quantum processing unit,” anticipated to enhance computing power significantly.
Meanwhile, Tesla’s stock rose by 1.8%, reacting to news that another electric vehicle maker, Nikola, had filed for Chapter 11 bankruptcy protection, resulting in a 39.1% drop in its shares.
A recent report indicated that fewer homes were initiated by U.S. builders than anticipated last month, reflecting ongoing challenges in the housing market.
High mortgage rates continue to pose affordability issues for potential homebuyers, despite efforts from the Federal Reserve to stabilize economic conditions by lowering its main interest rate.
The yield on the 10-year Treasury bond slightly decreased to 4.53% from 4.55%, down from 3.70% in September and near 4.80% in recent weeks.
Both bond and stock markets appear to be adapting to the ongoing tariff situation, previously marked by heightened anxiety. Investors are hopeful that tariff threats may serve as negotiation leverage rather than leading to severe outcomes.
In summary, the S&P 500 added 14.57 points, concluding at 6,144.15. The Dow Jones Industrial Average rose 71.25 points to 44,627.59, and the Nasdaq composite increased by 14.99 points, finishing at 20,056.25.
In energy markets, benchmark U.S. crude oil prices fell by 30 cents to $71.95 per barrel, while Brent crude dipped by 1 cent, settling at $76.03 per barrel.
In currency exchanges, the U.S. dollar retreated to 150.04 Japanese yen from 151.37 yen. The euro rose slightly to $1.0429 from $1.0428.