Asian stocks showed a mostly positive trend on Wednesday as investors awaited the Federal Reserve's final rate decision of the year. U.S. futures were on the rise, while oil prices displayed mixed movements.
Japan's Nikkei 225 index slipped by 0.2% in morning trading, standing at 39,281.06, following a 3.8% growth in exports and a 3.8% decline in imports in November. Nissan Motor Corp.'s shares experienced a surge of 22%, prompting a temporary suspension of trading amid reports of a potential merger with Honda Motor Co., which saw its shares drop by 3%.
The yen weakened ahead of the Bank of Japan meeting, where the central bank is expected to maintain its benchmark rate during the policy update on Friday. In Hong Kong, the Hang Seng index rose by 0.6%, while the Shanghai Composite index gained 0.7%. South Korea's Kospi index jumped by 1%, and Australia's S&P/ASX 200 edged 0.1% lower.
The S&P 500, Dow Jones Industrial Average, and Nasdaq composite experienced slight declines on Tuesday. A survey by Bank of America revealed a shift towards U.S. stocks among global fund managers, with reduced cash reserves. The S&P 500 is poised for one of its best years, up nearly 27%, supported by a resilient U.S. economy and expectations of growth under the incoming administration.
The Federal Reserve is anticipated to announce a rate cut on Wednesday, with projections for future rate movements. However, expectations for further cuts have diminished due to concerns about inflation surpassing the 2% target. Strong retail sales data in the U.S. may influence the Fed's decision-making, potentially leading to a pause in rate cuts.
Treasury yields remained stable, with the 10-year yield at 4.40% and the two-year yield at 4.24%. Bitcoin reached a record high above $108,000 before retracing slightly. U.S. benchmark crude oil rose to $69.72 per barrel, while Brent crude stood at $73.25 per barrel. The U.S. dollar weakened slightly against the Japanese yen and the euro.
