Asian shares mixed ahead of Fed meeting after China cuts rate | Business news

BEIJING (AP) — Asian stock markets were mixed Monday after China cut an interest rate that affects mortgage lending, while investors awaited a Federal Reserve conference this week for signs of possible new U.S. rate hikes to stop rising inflation.

Shanghai advanced after China’s central bank cut its five-year lending rate target to support weak home sales. Tokyo and Hong Kong refused. Oil prices rose by almost $1 per barrel.

Investors are eyeing the Fed’s annual meeting in Jackson Hole, Wyoming, for rate guidance after the U.S. central bank’s July board meeting last week confirmed plans for more hikes despite signs of easing economic activity.

Traders worry that aggressive rate hikes this year by the Fed and central banks in Europe and Asia to curb inflation, which is at multi-decade highs, could derail global economic growth.

“The Fed is still experiencing inflation. His actions have not even begun to ease inflationary pressures,” Clifford Bennett of ACY Securities said in a report. “They haven’t even started curtailing economic activity at all. The economic slowdown was already in play for other reasons.”

The Shanghai Composite rose 0.4% to 3,270.59, while Tokyo’s Nikkei 225 fell 0.4% to 28,805.52. Hong Kong’s Hang Seng was down less than 0.1% at 19,770.92.

South Korea’s Kospi was down 0.7% at 2,475.35, while Sydney’s S&P ASX-200 was down 0.8% at 7,060.20. New Zealand and Singapore advanced while Indonesia fell.

On Wall Street, the benchmark S&P 500 lost 1.3% on Friday, erasing gains earlier in the week.

The S&P fell to 4,227.48, ending the week down 1.2%. This year it decreased by 11.3%.

The Dow Jones Industrial Average fell 0.9% to 33,706.74. The Nasdaq Composite lost 2% to 12,705.22.

Technology stocks suffered some of the biggest losses. Microsoft fell 1.4%. Retailers, banks and telecommunications companies also fell.

Bright spots included General Motors, which rose 2.5% after reinstating its dividend. Foot Locker rose 20% after replacing its CEO and reporting earnings that beat forecasts.

Traders await new US earnings reports.

China’s central bank cut its lending rate, the target rate for market rates, as part of efforts to shore up weak economic growth after a debt crackdown triggered a slump in real estate and Shanghai and other cities were shut down to fight virus outbreaks.

The five-year loan plan was reduced by 0.15 percentage points to 4.3%. The one-year lending rate that affects other industries was cut by just 0.05 percentage points to 3.65%.

The move “reflects the severity” of the property slump and shows Beijing is “ready to take tougher measures,” Invesco’s David Chao said in a report.

China’s leaders are trying to revive economic growth, which fell to 2.5% year-on-year in the first half of 2022, without resorting to blanket stimulus that could push up inflation or boost politically sensitive housing costs.

In energy markets, benchmark US crude fell 90 cents to $89.54 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the benchmark for international trade, fell 90 cents to $95.82 a barrel in London.

The dollar rose to 137.21 yen from 136.91 yen on Friday. The euro rose to $1.0045 from $1.0034.

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