Asian markets are moving in the green on Friday, November 8 in the first trades, encouraged like Wall Street the day before by a rate cut from the American Federal Reserve (Fed) and the prospect of further monetary easing.
The Fed in easing mode
The American Central Bank lowered its rates for the second time this year on Thursday by 0.25% – to a range between 4.50% and 4.75% – with its President Jerome Powell welcoming progress on the front of inflation. The latter, however, refused to make any comments on a possible weakening of the independence of the Fed after the election to the presidency of the United States of Donald Trump, who had shown himself to be accustomed to interference in monetary policy in the during his first term.
“Asian markets end an epic political week, fueled by a surge in US markets’ risk appetite after dovish remarks” from Jerome Powell, noted Stephen Innes of SPI Asset Management. The fact that it paved the way for further rate cuts “although at a slower pace, should provide a new boost of optimism throughout the region”according to this analyst.
The dollar plays appeasement
On the foreign exchange market, the dollar was catching its breath after soaring on the announcement of Donald Trump’s victory. The greenback did not react excessively to the Fed’s rate cut which had been largely integrated by the markets. Around 01:45 GMT, the greenback gained 0.1% against the Japanese currency, at 153.06 yen per dollar. It rose against the common European currency, to 1.0787 euros per dollar against 1.0805 dollars the day before.
Oil prices were sliding after their rebound the day before, while the market continued to assess the impact of a new Trump presidency on black gold prices. Around 01:45 GMT, the price of a barrel of Brent from the North Sea dropped 0.22% to 75.46 dollars, and that of West Texas Intermediate (WTI) fell 0.39% to 72.08 dollars.
Tokyo driven by tech
In Tokyo around 01:45 GMT, the flagship Nikkei index gained 0.35% to 39,519.39 points, and the broader Topix index rose 0.12% to 2,746.50 points. “The recovery of American technology stocks on Thursday, still benefiting from a “Trump” should provide a boost to Japanese markets, particularly to sectors linked to semiconductors”commented Shutaro Yasuda of Tokai Tokyo Intelligence Lab.
The renewed strength of the yen, while the dollar fell from its highs on Wednesday, should also penalize Japanese exporting groups, he added.
Sanctions at odds after results
Some Japanese stocks were struggling, with Nissan shares losing 6.63% to 382.8 yen around 01:50 GMT after falling as much as -10%, following the announcement the day before by the Japanese car manufacturer that he was going to cut 9,000 positions from its global workforce and cut its production capacities to adapt to a clear decline in its sales.
The Japanese cosmetics giant Shiseido was no better off (-7% to 2,959 yen) after publishing unvarnished financial results for the third quarter on Thursday and downgrading its annual forecasts while the recovery of its sales abroad remains sluggish. .
Chinese markets optimistic
The Chinese markets were also doing well shortly after the opening: Hong Kong advanced by 1.2% to 21,203.77 points, Shanghai by 0.14% to 3,475.44 points and Shenzhen by 0.35% to 2,108.10. points.
Analysts will be watching in the coming days for a series of economic data to try to take the pulse of the world’s second largest economy, including consumer prices expected on Saturday and the “Singles’ Day” on Monday, the Chinese equivalent of Black Friday generally conducive to consumption.
