UNITED STATES NEWS

Stock market today: Asia shares rise as Fed holds rates steady while hinting of hikes ahead

Jun 13, 2023, 10:24 PM | Updated: Jun 14, 2023, 8:50 pm

TOKYO (AP) — Asian shares were mostly higher Thursday after the U.S. Federal Reserve held interest rates steady.

Data from China showed consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed. Consumers, uneasy about possible job losses, have returned to shops and restaurants less quickly than expected.

In Japan, machinery orders for April, released Thursday, showed the first growth in three months. Trade figures for May showed a deficit for 22 months in a row, as import costs rose with the rising energy and other prices.

Japan’s benchmark Nikkei 225 rose 0.3% to 33,589.50. Australia’s S&P/ASX 200 added 0.3% to 7,180.90. South Korea’s Kospi shed 0.4% to 2,607.60. Hong Kong’s Hang Seng gained 0.7% to 19,543.59, while the Shanghai Composite edged up nearly 0.2% to 3,235.07.

In standing pat on rates, Fed Chair Jerome Powell said the economy will have more time to absorb past hikes, adding, “ideally by taking a little more time, we won’t go well past the level where we need to go.”

That may give the economy and financial markets breathing room, but there was some skepticism.

“It is too early to say that Powell is winning the fight against inflation,” said Ruslan Lienkha, chief of markets at YouHodler, a financial services company.

“The Fed can later decide to continue the rate increase or keep high rates for a significantly long time. Such scenarios are quite possible and might obviously disappoint financial markets in one or a few months.”

Wall Street swung to a mixed finish in anticipation of interest rate hikes later this year, even as it was held steady for the time being.

The S&P 500 finished the day 0.1% higher to 4,372.59 after pinballing between gains and losses following the Fed’s announcement. The Dow Jones Industrial Average dropped 0.7% to 33,979.33, while the Nasdaq composite rose 0.4% to 13,626.48.

The Fed closed its latest policy meeting by saying it would keep rates where they are to give more time to see how its fusillade of hikes over the last 15 months is affecting the economy. It’s trying to slow the economy just enough through rate increases to snuff out high inflation without damaging the job market and creating a recession.

The majority of Fed policy makers indicated Wednesday they still expect its main interest rate to climb at least 0.50 percentage points by the end of the year. The federal funds rate is already at its highest level since 2007, in a range between 5% and 5.25%.

Inflation has slowed since last summer’s peak, but Powell said there hasn’t been enough improvement in underlying trends to feel comfortable.

In anticipation of future increases to rates, yields in the bond market rose following the Fed’s announcement. The 10-year yield climbed as high as 3.83% from 3.77% just before the Fed’s announcement.

It later receded to 3.79%, compared with 3.82% late Tuesday. That yield helps set rates for mortgages and other important loans.

The two-year Treasury yield, which moves more on expectations for the Fed, climbed to 4.68% from 4.67% late Tuesday and was as high as 4.78%.

Stock indexes initially sank following the Fed’s announcement, but they pared their losses, as Powell spoke at a press conference.

Wednesday marked the first time in more than a year the Fed has not hiked rates at a meeting. Inflation is still too high for comfort, causing misery especially for those with lower incomes.

In energy trading, benchmark U.S. crude slipped 13 cents to $68.14 a barrel in electronic trading on the New York Mercantile Exchange. It gave up $1.15 on Wednesday to $68.27 a barrel.

Brent crude, the international standard, lost 15 cents to $73.05 a barrel.

In currency trading, the U.S. dollar cost 141.03 Japanese yen, up from 140.07 yen. The euro cost $1.0814, down from $1.0833.

___

AP Business Writer Stan Choe contributed.

Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

United States News

President Joe Biden gestures after speaking to graduating students at the Morehouse College commenc...

Associated Press

Biden tells Morehouse graduates that scenes in Gaza from the Israel-Hamas war break his heart, too

Joe Biden on Sunday offered his most direct recognition of U.S. students' anguish over the Israel-Hamas war.

4 hours ago

A helicopter carrying Iranian President Ebrahim Raisi suffered a “hard landing” on Sunday, May ...

Associated Press

Helicopter carrying Iran’s hard-line president apparently crashes in foggy, mountainous region

A helicopter carrying Iranian President Ebrahim Raisi, the country's foreign minister apparently crashed in mountainous Iran on Sunday.

8 hours ago

Associated Press

Child is among 3 dead after Amtrak train hits a pickup truck in upstate New York

NEW YORK (AP) — A child was among the three victims killed when a passenger train hit a pickup truck, officials said. The northbound Amtrak train hit a Dodge truck Friday evening in North Tonawanda, New York, a small town along the Niagara River between Niagara Falls and Buffalo, police said. The victims included a […]

10 hours ago

Associated Press

11 hurt in mass shooting that marked a weekend of gun violence in Savannah, Georgia

SAVANNAH, Ga. (AP) — An argument between two women led to a gunfight that left 11 people hurt in a busy tourist area of Savannah, Georgia, late Saturday, one of five weekend shootings in the city, two of which were fatal, authorities said. Two people were injured in separate shootings Friday. Two more shootings Saturday […]

11 hours ago

Associated Press

Pro-Palestinian protesters set up a new encampment at Drexel University

PHILADELPHIA (AP) — Pro-Palestinian protesters set up a new encampment at Drexel University in Philadelphia over the weekend, prompting a lockdown of school buildings, a day after authorities thwarted an attempted occupation of a school building at the neighboring University of Pennsylvania campus. Up to 60 protesters were at the encampment on the campus’ Korman […]

12 hours ago

Associated Press

Power restored to most affected by deadly Houston storm, with the rest by Wednesday

HOUSTON (AP) — Houston area residents affected by deadly storms last week received some good news as officials said power had been restored Sunday to a majority of the hundreds of thousands who had been left in the dark and without air conditioning amid hot and humid weather. The widespread destruction of Thursday’s storms left […]

12 hours ago

Sponsored Articles

...

Day & Night Air Conditioning, Heating and Plumbing

Beat the heat, ensure your AC unit is summer-ready

With temperatures starting to rise across the Valley, now is a great time to be sure your AC unit is ready to withstand the sweltering summer heat.

...

Day & Night Air Conditioning, Heating and Plumbing

Day & Night is looking for the oldest AC in the Valley

Does your air conditioner make weird noises or a burning smell when it starts? If so, you may be due for an AC unit replacement.

...

Fiesta Bowl Foundation

The 51st annual Vrbo Fiesta Bowl Parade is excitingly upon us

The 51st annual Vrbo Fiesta Bowl Parade presented by Lerner & Rowe is upon us! The attraction honors Arizona and the history of the game.

Stock market today: Asia shares rise as Fed holds rates steady while hinting of hikes ahead