Asian markets traded mixed on Friday as investors approached the weekend cautiously, weighed down by a quiet lead from Wall Street and uncertainty around the US Federal Reserve’s next interest rate move. The latest batch of US economic data offered little clarity, doing just enough to reinforce expectations that the Fed is likely to cut rates next week — a possibility now priced at nearly 90 percent. Still, traders struggled to build on last week’s strong momentum that had been driven by dovish signals from central bank officials.
Much of the market’s optimism this week has been tied to signs that the US job market is gradually cooling. Payroll processor ADP reported a loss of more than 30,000 jobs in November, adding to growing evidence of easing labour conditions. But Thursday’s figures on jobless claims and layoffs came in slightly better than forecast, leaving investors searching for firmer direction. The continued tug-of-war in data has kept markets on edge ahead of the Fed’s rate decision.
All eyes are now on the release of the personal consumption expenditures (PCE) index — the Fed’s preferred measure of inflation. A reading below expectations could strengthen the case for not just a rate cut next week, but a series of reductions through 2026. Additional data on household income and spending is also expected later Friday, leaving investors bracing for a potentially market-moving session. Still, debates continue within the financial community about how aggressively the Fed can move while inflation remains above target.
Market analysts remain divided. Michael Hewson of MCH Market Insights warned that while the labour market is slowing, it isn’t weakening fast enough to guarantee a smooth path for further easing. With the crucial monthly jobs report scheduled to arrive only after the Fed’s meeting, he suggested that an additional 25-basis-point cut may be seen as a “leap of faith” by some committee members. Any hesitation or delay from the Fed, he added, could trigger a sharp market reaction, especially after three consecutive cuts this year.
The uncertainty weighed on regional markets. Tokyo fell more than one percent following Thursday’s two-percent surge, while Hong Kong, Shanghai, Singapore, and Wellington also dipped. Meanwhile, Sydney, Manila, Taipei, Seoul, and Jakarta managed modest gains. In corporate highlights, Chinese AI chipmaker Moore Threads Technology stunned markets with a soaring 450 percent surge on its Shanghai debut after raising $1.13 billion in its IPO — a rare bright spot in an otherwise cautious trading day.
source: punch