Asian stocks were mostly higher on Wednesday ahead of the Federal Reserve's final rate decision of this year.
U.S. futures rose while oil prices were mixed.
Japan’s benchmark Nikkei 225 slipped 0.2% in morning trading to 39,281.06 after the nation's exports grew 3.8% in November year-on-year. Meanwhile, imports fell by 3.8%, according to data from the Ministry of Finance.
Trading in Nissan Motor Corp.’s shares temporarily was suspended after they surged 22% as reports said the automaker was considering a possible merger with Honda Motor Co. The latter’s shares lost as much as 3%.
The companies issued a statement saying they were discussing closer collaboration but had not decided anything yet. Nissan, Honda and Nissan alliance member Mitsubishi Motors Corp. agreed in August to share components for electric vehicles like batteries and to jointly research software for autonomous driving to adapt better to dramatic changes in the auto industry.
The yen traded lower ahead of a meeting by the Bank of Japan, where the central bank is expected to keep its benchmark rate unchanged when it provides a policy update on Friday.
The Hang Seng in Hong Kong added 0.6% to 19,815.30 and the Shanghai Composite index gained 0.7% to 3,385.64.
In South Korea, the Kospi jumped 1% to 2,481.87. Australia’s S&P/ASX 200 edged 0.1% lower to 8,304.00.
On Tuesday, the S&P 500 slipped 0.4% to 6,050.61, though it’s still near its all-time high set earlier this month. The Dow Jones Industrial Average dropped 0.6% to 43,449.90, and the Nasdaq composite gave back 0.3% from its record set the day before to 20,109.06.
Across a survey of global fund managers, strategists at Bank of America found many plowing into U.S. stocks and pulling out cash reserves to do so. The survey found fund managers are holding a notably small percentage of their overall portfolios in cash, similar to 2002 and 2011, which preceded tougher times for riskier investments.
The S&P 500 is on track for one of its best years since the millennium, up nearly 27%, because the U.S. economy has remained remarkably resilient, hopes are high that President-elect Donald Trump’s policies will boost growth but not inflation too badly and the Federal Reserve has begun to make things easier by cutting interest rates from a two-decade high.
The Fed is widely expected to announce the third cut of the year to its main interest rate on Wednesday, and officials are also scheduled to unveil projections about where they see rates heading in upcoming years.
Expectations for coming cuts have been on the downswing, though, as inflation looks like it could stubbornly stick above the Fed’s 2% target after slowing sharply from its peak above 9%.
A report on Tuesday showed sales at U.S. retailers strengthened by more last month than economists expected. That could be an indication of an economy that doesn’t need much more help from easier interest rates. While lower rates can goose the economy, they can also give inflation more fuel.
“The Fed is still on track to cut rates (Wednesday), but more strong economic data could make it more likely they’ll pause in January,” according to Chris Larkin, managing director, trading and investing, at E-Trade from Morgan Stanley.
Treasury yields held relatively steady following the report. The 10-year Treasury yield held at 4.40%, where it was late Monday. The two-year yield, which more closely tracks expectations for the Fed, edged down to 4.24% from 4.25%.
Bitcoin set a record above $108,000 on Tuesday before pulling back toward $106,500, according to CoinDesk.com. It’s catapulted from roughly $44,000 at the start of the year, riding a recent wave of enthusiasm that Trump will create a system that’s more favorable to digital currencies.
In other dealings Wednesday, U.S. benchmark crude oil rose 7 cents to $69.72 per barrel. Brent crude, the international standard, added 6 cents to $73.25 per barrel.
The U.S. dollar fell to 153.47 Japanese yen from 153.50 yen. The euro traded at $1.0505, up from $1.0491.
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AP Business Writer Stan Choe contributed.
