Stocks mixed as traders pause Fed-fuelled rally

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HONG KONG – Equity markets saw cautious moves on Wednesday as traders take a breather from a global rally that has been fuelled by expectations the Federal Reserve will cut interest rates next month.
With few sparks to drive buying, markets took their cue from Wall Street, where the main indexes slipped after an eight-day advance, with focus on a speech Friday by central bank boss Jerome Powell at the Jackson Hole symposium in Wyoming.
After a hefty retreat at the start of the month — caused by a weak US jobs report that fanned recession fears — investors have rediscovered their buying mojo, with speculation rife that the Fed will begin easing monetary policy at its September meeting.
Data showing inflation easing, retail sales remaining healthy and the jobs market softening — but not too quickly — have reinforced a long-running view that bank officials are on course to guide the economy to a soft landing and avert a recession.
With bets now baked into a reduction, speculation is now focused on how many cuts are in the pipeline and how big they will be, with some suggesting as much as 100 basis points before the end of the year.
Its forecast rate cut would come as central banks around the world begin easing after years of battling soaring inflation.
Sweden on Tuesday announced its second cut this year, while New Zealand last week moved for the first time since early 2020. The Bank of England and European Central Bank have also moved, and are eyeing more cuts before January.
All three main indexes on Wall Street dipped, having come within distance of their record highs.
And the losses filtered through to Asia.
Hong Kong was among the main losers as tech firms took a hit, with e-commerce titan JD.com briefly tumbling more than 11 percent after a Bloomberg report said US retail behemoth Walmart planned to unload $3.7-billion of shares in the firm at a discount.
Tokyo, Shanghai, Mumbai, Manila, Singapore and Taipei also slipped, though Sydney, Bangkok, Seoul and Jakarta eked out gains.
London was flat while Paris and Frankfurt edged higher.