Japanese stocks gained, while most other markets in Asia fell amid caution ahead of next week’s US election and the Federal Reserve’s rate decision.
The Topix Index rose about 1%, boosted by the tech sector on the back of a record close for the Nasdaq Composite overnight. Shares in mainland China, Hong Kong and Australia fell.
Treasury yields slipped, while a Bloomberg gauge of the dollar’s strength snapped a three-day advance. The yen climbed. Gold hit a fresh record early on Wednesday as traders weighed potential market disruption ahead of the election. Bitcoin, seen as a Trump trade, hovered near its all-time high.
In addition to risks posed by US events, traders in Asia are also preparing for potential market moves following the Bank of Japan’s decision on Thursday and a meeting by China’s top legislative body to be held Nov. 4-8, where further fiscal stimulus may be announced. Asia’s regional equity benchmark is set for its worst monthly performance in a year.
“We anticipate range-bound trading with limited surprises until the results of the US elections and the Fed’s interest-rate decision are announced,” said Kimmy Tong, global market & FX strategist at Everbright Securities International.
In late US trading, Alphabet Inc. climbed more than 5% as the Google parent’s earnings beat estimates, while Advanced Micro Devices Inc. sank 7% amid a lackluster revenue forecast. The S&P 500 closed up 0.2%. US equity futures advanced in Asian hours.
Just about a week away from the Fed decision, data showed US job openings fell to the lowest since early 2021. The figures run counter to the September employment report that pointed to a still-strong labor market, which prompted traders to trim bets on another big rate cut. A separate reading showed consumer confidence hit the highest since the start of the year.
Treasuries are on track for their worst month in more than two years amid signs of economic strength, posturing for the election and heavy supply of new notes and bonds. Oil was steady after losing more than 6% in the previous two sessions on easing concerns the conflict in the Middle East will affect supply.
Back in Asia, China is in the spotlight after Reuters reported that authorities were weighing approval of 10 trillion yuan ($1.4 trillion) in additional borrowing in the coming years to bolster the economy and address local government debt risks.
Australia’s core inflation remained elevated last quarter, reinforcing the Reserve Bank’s view that price pressures will take time to dissipate. The Aussie dollar fluctuated on the results.
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