With key economic data from the US not moving expectations for a Federal Reserve interest-rate cut only for the middle of the year, traders are turning their attention to how the rotation out of tech pans out. Asian shares have outpaced gains on Wall Street this year on relatively cheaper valuations and optimism over the artificial-intelligence trade.
Crude oil prices declined for the first time in six days post US President Donald Trump signalling he may hold off on attacking Iran for now. Precious metals also declined from their peaks.
Silver slipped 1.3% as Trump held off on imposing new tariffs on imports of critical minerals, while gold also retreated.
Meanwhile, the US Supreme Court didn’t rule on challenges to Trump’s tariffs on Wednesday, leaving the world to wait until at least next week to learn the fate of his signature economic policy.
The South Korean won edged lower in Asia after jumping Wednesday when US Treasury Secretary Scott Bessent referred to excessive declines in the currency. His comments represented rare verbal support to the won as it slides toward its weakest since 2009.
The won weakened 0.2% against the dollar as the Bank of Korea left its benchmark rate unchanged in a widely predicted policy decision.Attention was also on Japan, where Prime Minister Sanae Takaichi was expected to call a snap election early in the parliamentary session starting later this month. Equities in the country had rallied and the yen had come under pressure amid reports of a snap poll.
On Thursday, the yen fluctuated after Bessent spoke with Japanese Finance Minister Satsuki Katayama and noted the “inherent undesirability of excess exchange rate volatility.”
Back to stocks, while the S&P 500 fell Wednesday amid a slide in all “Magnificent Seven” shares, more than 300 of its firms actually rose. Small caps continued to outperform, with the Russell 2000 beating the S&P 500 for a ninth straight session — matching the longest streak since 1990.
On the macro front, US retail sales rose in November by the most since July, fueled by a rebound in auto purchases and resilient holiday shopping. Wholesale inflation picked up slightly on a jump in energy costs, even as prices for services were unchanged.
With inputs from Bloomberg
Also Read: Crude oil prices fall after Trump holds off on any attack on Iran
