TOKYO (AP) — Asian shares were trading mixed on Monday, as investors awaited further indications the Federal Reserve might begin cutting interest rates.
Japan’s Nikkei 225 shed 0.7 per cent to 40,619.40, as investors sold shares to lock in profits after the benchmark recently hit record highs.
Hong Kong’s Hang Seng climbed 0.5 per cent to 16,584.22, while the Shanghai Composite gained 0.4 per cent to 3,061.36.
The Chinese yuan, or renminbi, fell to a four-month low of 7.2282 to the US dollar.
Australia’s S&P/ASX 200 rose 0.6 per cent to 7,813.70. South Korea’s Kospi lost 0.5 per cent to 2,735.46.
A top Japanese finance official expressed reservations about the recent surge in the US dollar against the Japanese yen, fuelling speculation about possible intervention in the market. The dollar has risen to nearly JPY152, a jump from slightly above JPY130 a year ago. It was trading at JPY151.13 on Monday, up from JPY151.41. The euro cost USD1.0814, up from USD1.0810.
The Bank of Japan raised a key interest rate for the first time in 17 years last week, to barely above zero from below zero, or negative interest rates. That means borrowing rates in Japan still remain below those of the US and many other nations.
“The recent Bank of Japan meeting added another layer of complexity to the dollar’s trajectory. Despite the BOJ’s decision to hike rates, cautious communication failed to stimulate demand for the Japanese yen,” said Luca Santos, currency analyst ACY Securities.
On Friday, the S&P 500 slipped 0.1 per cent from an all-time high to close at 5,234.18. The Dow Jones Industrial Average fell 0.8 per cent to 39,475.90 and the Nasdaq composite rose 0.2 per cent to 16,428.82, adding to its record.
In the bond market, US Treasury yields pulled back. The yield on the 10-year Treasury fell to 4.21 per cent from 4.27 per cent late Thursday.
The US Federal Reserve has indicated it may deliver three cuts to interest rates this year, as long as inflation keeps cooling. The Fed’s main interest rate is at its highest level since 2001.
In energy trading, benchmark US crude added 52 cents to USD81.15 a barrel. Brent crude, the international standard, rose 52 cents to USD85.35 a barrel.
