Asian stock market falls due to Fed’s actions on rates
2023.02.23 02:06
Asian stock market falls due to Fed’s actions on rates
By Ray Johnson
Budrigannews.com – Despite a stronger-than-expected revenue forecast from Nvidia boosting regional technology stocks, particularly those of chipmakers, the majority of Asian stock markets retreated on Thursday due to persistent concerns about rising U.S. interest rates.
The day’s best performer in Asia was the, which gained 1.3% thanks to gains in major chipmaking stocks. Nvidia Corporation, based in the United States (NASDAQ:) forecast revenue for the first quarter that was higher than what the market had anticipated and cited rising demand for chips that power artificial intelligence services.
In aftermarket trade, the company’s shares rose by more than 8%. These gains also spread to Asian stocks, many of which supply the chipmaker. Semiconductor Manufacturing Co. of Taiwan (TW:), which is one of Nvidia’s largest subcontractors, increased by more than 2%.
South Korea’s index increased by 1%, while Hong Kong’s rose by 0.3 percent. After nearly 18 months of hikes, the Bank of Korea saw the KOSPI index rise.
However, the outlook for technology stocks remains limited, particularly given that they are expected to rise even more. This year, chipmakers may also face a slowdown in demand as global businesses cut back on tech spending out of fear of a recession.
As the bank reiterated its hawkish rhetoric, general Asian stocks moved in a range from flat to low. The recent, which came out after the Fed meeting, is likely to bolster the bank’s hawkish stance even more.
While losses across risk-heavy Southeast Asian bourses were led by a 0.4% decrease, China’s and indexes both experienced gains of less than 1%.
Due to a holiday in Japan, Asian trading volumes were also somewhat muted. Nevertheless, the likelihood of rising U.S. interest rates drew foreign capital away from the region, resulting in steep losses for the week for the majority of regional indexes.
Now, the focus is on the, which is due later in the day, as well as the Fed’s preferred inflation gauge, the, which is due on Friday.
The United States’ economic expansion gives the Federal Reserve more leeway to keep raising interest rates, which it intends to do this week.
Despite data indicating growth that was greater than anticipated in the fourth quarter, Australia’s index fell 0.4%. Despite its difficulties and slowing growth, the data indicate some strength in the Australian economy.
