Asia Stocks Set for Cautious Start as Fed in Focus
Asian stocks are set to open cautiously on Wednesday as investors await the outcome of the Federal Reserve’s policy meeting. The dollar held gains and Treasuries were steady.
U.S. Markets
U.S. stocks rose on Tuesday, with the S&P 500 Index closing at a record, as investors bet the Fed will keep its easy monetary policy in place. The central bank is widely expected to keep interest rates near zero and maintain its asset purchases.
The S&P 500 rose 0.7%, while the Nasdaq Composite Index gained 0.9%. The Dow Jones Industrial Average rose 0.5%.
The 10-year Treasury yield was little changed at 0.68%. The dollar index was steady at 92.45.
European Markets
European stocks rose on Tuesday, with the Stoxx Europe 600 Index closing at its highest level since February 2020.
The Stoxx 600 rose 0.7%, with banks and automakers leading the gains. The U.K.’s FTSE 100 Index rose 0.7%, while Germany’s DAX Index gained 0.8%.
The euro was little changed at $1.1836.
Asia-Pacific Markets
Futures pointed to a mixed start for Asian stocks. Japan’s Topix index was little changed, while Australia’s S&P/ASX 200 Index rose 0.2%.
In Hong Kong, the Hang Seng Index was little changed. South Korea’s Kospi index rose 0.2%.
Oil
Oil rose on Tuesday, with West Texas Intermediate crude for November delivery gaining 0.7% to settle at $40.63 a barrel.
Currencies
The Bloomberg Dollar Spot Index was little changed. The euro was steady at $1.1836. The Japanese yen was little changed at 105.71 per dollar.
Fed Meeting in Focus
Investors are awaiting the outcome of the Federal Reserve’s policy meeting, which is expected to be a non-event. The central bank is widely expected to keep interest rates near zero and maintain its asset purchases.
The Fed is also expected to reiterate its commitment to using its full range of tools to support the economy.
The focus will be on the central bank’s economic projections and the press conference by Fed Chair Jerome Powell.
U.S. Economic Data
In the U.S., investors will be watching for economic data, including the latest readings on retail sales and industrial production.
Retail sales are expected to have risen 0.7% in August, while industrial production is expected to have risen 0.4%.
Global Outlook
The global economic outlook remains uncertain as the coronavirus pandemic continues to weigh on activity.
The U.S. is still struggling to contain the virus, with cases rising in some states. Europe is also seeing a resurgence in cases, with France and Germany imposing new restrictions.
In Asia, Japan is seeing a resurgence in cases, while China is seeing a slowdown in economic activity.
Outlook
The outlook for global markets remains uncertain as investors await the outcome of the Fed’s policy meeting. The focus will be on the central bank’s economic projections and the press conference by Fed Chair Jerome Powell.
Investors will also be watching for economic data from the U.S., including the latest readings on retail sales and industrial production.
The global economic outlook remains uncertain as the coronavirus pandemic continues to weigh on activity. The U.S. is still struggling to contain the virus, while Europe is seeing a resurgence in cases. In Asia, Japan is seeing a resurgence in cases, while China is seeing a slowdown in economic activity.