Asian Markets Mixed as Japanese Exports Hit 4-Year Low, Investors Await Fed Rate Signals

Asian stock markets closed mixed on Wednesday as Japan reported its steepest drop in exports in more than four years, raising fresh concerns over global trade. Tokyo’s Nikkei 225 fell 1.5%, while South Korea and Taipei also posted declines. Meanwhile, Hong Kong recovered from early losses to close higher, alongside gains in Shanghai, Sydney, Jakarta and Bangkok. Manila’s bourse ended flat.

The slump in Japan’s exports highlights mounting pressure on the country’s economy, already challenged by slowing global demand and ongoing trade tensions. Official data showed a sharper-than-expected contraction, underscoring the impact of weaker demand for Japanese goods. This comes as investors digest higher inflation data from the UK, where consumer prices in July rose at their fastest pace since early 2023, driven largely by surging food and energy costs.

Tech stocks also faced renewed selling pressure after major firms including Nvidia, Palantir, and Oracle lost market share on Tuesday. Analysts say concerns over lofty valuations and geopolitical uncertainties, particularly tariffs introduced by U.S. President Donald Trump, have fueled investor caution. Despite Hong Kong’s rally, market watchers warn that the prolonged tech selloff remains a risk factor weighing on global equities.

Attention now shifts to U.S. monetary policy, with traders awaiting a highly anticipated speech from Federal Reserve Chair Jerome Powell at the Jackson Hole retreat in Wyoming on Friday. Investors hope for clearer signals on whether the Fed will move ahead with an expected interest rate cut in September, following mixed U.S. inflation data released last week. Analysts caution that Powell faces a delicate balancing act, as overly dovish guidance could stoke inflation fears, while a hawkish tone might rattle equity markets.

In early European trade, London and Paris stocks dipped while Frankfurt managed a modest gain. Currency markets saw the euro slip against the dollar, while oil prices ticked higher with Brent crude up 0.8% at $66.29 per barrel. With markets on edge, global investors remain focused on central bank policy decisions, geopolitical developments, and fragile trade dynamics shaping the economic outlook.

Source: Punch