U.S. stock futures ticked higher early Thursday after the Federal Reserve indicated the
possibility of a rate hike this year.
Asia-Pacific markets opened mixed, with South Korea's Kospi and Japan's Nikkei 225 jumping to fresh records.
The
Kospi rose over 1% to hit 9,000 for the first time. Index heavyweight SK Hynix advanced 3.45% to notch a fresh high, while Samsung Electronics rose 1.23%. The small-cap Kosdaq declined 0.5%.
Hong Kong's
Hang Seng index was down 0.76%, while the mainland's CSI 300 was flat.
Wednesday marked the first meeting of the Federal Reserve with Kevin Warsh at the helm of the U.S. central bank. At the conclusion of the meeting, the Fed kept the benchmark federal funds rate unchanged and anchored in a range of between 3.5% and 3.75%.
Policymakers' "dot plot" revealed that several Fed officials now see interest rates increasing in 2026. The median estimate for the year-end interest rate now stands at 3.8%, up from 3.4% in prior projections from March, suggesting that at least one rate hike could be in the picture in 2026.
Complicating the forecast was Warsh's
decision to abstain from submitting a rate forecast.
Following the meeting, stocks fell across the board. The
Dow, which had hit a new all-time intraday high earlier in the day, ultimately declined 507.12 points, or 0.98%. The S&P 500 fell 1.21%, while the Nasdaq Composite lost 1.34%.
On the other hand, bond yields jumped. The
two-year Treasury yield hit a high of 4.22%.
"The Fed held rates steady but spoiled the mood with a much more hawkish dot plot. Elevated inflation makes that understandable, but the committee is far from united, with only about half still penciling in rate hikes later this year," said Sonu Varghese, chief macro strategist at Carson Group. "The bigger point is that policy still looks loose for an economy where inflation remains a problem and the labor market is stabilizing."
"The market doesn't like regime change," added David Zervos, chief market strategist at Jefferies, on CNBC's "
Closing Bell: Overtime" on Wednesday afternoon. Accenture and Kroger will report earnings before Thursday's opening bell. Traders will also watch out for May's leading indicators and June's Philadelphia Fed Index reading, alongside initial jobless claims from the week ended June 13.
Wall Street banks and foreign borrowers are rushing to tap China’s cheap money
Foreign governments, Wall Street banks and multinational companies are flocking to China's domestic bond market as some of the world's cheapest borrowing costs turn the yuan into an increasingly attractive funding currency.
The yuan-denominated bonds, also known as panda bonds, are sold by overseas issuers in China's onshore market and have become a major beneficiary of Beijing's push to internationalize its currency amid a widening gap between Chinese and Western interest rates.
Issuance has accelerated sharply this year, with sovereign borrowers including Kazakhstan and Pakistan joining global financial institutions such as Morgan Stanley and Deutsche Bank, as well as multinational firms including Volkswagen and Henkel. Deutsche Bank, as recently as late May, announced that it raised 3.5 billion yuan ($518 million) through a heavily oversubscribed three- and five-year panda bond offering.
Read the full story
here.
—Lee Ying Shan
Nvidia supplier SK Hynix shares jump as it ships next-gen HBM4E samples
South Korea's SK Hynix jumped over 3% to a fresh record high after the chipmaker announced it has supplied
samples of its 12-layer HBM4E memory chip to key customers.
SK Hynix said in a statement said the next-generation product delivers data transfer speeds of up to 16 gigabits per second per pin and improves power efficiency by more than 20% from previous models.
The South Korean chipmaker is a key HBM supplier to Nvidia.
—Lee Ying Shan
Asia markets open higher, Nikkei 225 and Kospi climbs to another record high
Asia-Pacific markets opened broadly higher, with South Korea's Kospi and Japan's Nikkei 225 edging higher to fresh records.
The
Kospi rose 0.89%. Index heavyweight SK Hynix advanced 3.45% to notch a fresh high, while Samsung Electronics rose 1.23%. The small-cap Kosdaq declined 0.5%.
Australia's benchmark
S&P/ASX 200 was flat.
Japan's
Nikkei 225 traded 1.35% higher to rise above 71,000 for the first time, while the Topix was up 1.27%.
Hong Kong
Hang Seng index futures were last at 24,510, higher than the index's prior close of 24,493.95.
— Lee Ying Shan
All 11 GICS sectors fall on Wednesday
Stocks fell across the board on Wednesday, with all 11 of the GICS sectors ultimately ending lower.
Leading the losses was the communication services sector, which fell 2.98%. This was followed by the consumer discretionary and real estate sectors, which respectively lost 2.69% and 2.47%.
On the other hand, industrials stocks, which shed a mere 0.12%, was the day's best-performing sector.
— Lisa Kailai Han
Wednesday marked worst 'Fed day' S&P 500 performance under a new chair since 1994
That marked the worst performance for the index on the first "Fed day" under a new chair since 1994, according to date from Bespoke Investment Group.
To be sure, only three other new Fed leaders have been named in that timespan: Ben Bernanke, Jerome Powell and Janet Yellen.
Read the full story
here.
— Alex Harring and Lisa Kailai Han
Asia markets set for mixed open after Fed's Warsh unveils central bank overhaul
Asia-Pacific markets looked poised for a mixed start on Thursday after Federal Reserve Chairman Kevin Warsh used his first press conference to unveil a broad review of the central bank's operations.
Japan's
Nikkei 225 was set to jump, with the Chicago futures contract at 70,825 and its Osaka counterpart last trading at 69,980, compared with the index's previous close of 69,902.25.
Hong Kong's
Hang Seng index futures were last at 24,200, lower than the index's last close of 24,312.16.
Futures for Australia's
S&P/ASX 200 traded at 8,909, while the index closed at 8,966.3.
Warsh said the Fed would create five dedicated task forces focused on communications, balance-sheet management, data usage, productivity and employment, as well as the central bank's approach to inflation targeting.
— Lee Ying Shan
<small>Source: CNBC</small>
