Asian Shares Mixed as Wall Street Declines Ahead of Fed Decision

TOKYO (AP) — Asian shares showed a mixed performance on Wednesday as investors awaited the Federal Reserve's decision on interest rates.

U.S. futures rose slightly while the price of oil dropped. Japan reported a trade surplus for February, with a notable increase in exports of over 11%. The Bank of Japan decided to maintain its benchmark rate at 0.5%, a move that many expected, aligning it with the anticipation that the Fed will also keep rates steady.

Market Overview

Japan’s Nikkei 225 index gained 0.2%, reaching 37,900.88. Meanwhile, Hong Kong’s Hang Seng index increased by 0.2% to 24,777.01, while the Shanghai Composite index saw little change, dipping slightly by less than 0.1% to 3,427.76. In Australia, the S&P/ASX 200 index fell by 0.3% to 7,836.80, and South Korea’s Kospi gained 0.9%, closing at 2,634.60.

Traders are keenly interested in the forecasts that the Fed will release after its meeting, which will outline expectations for interest rates, inflation, and the broader economy. Wall Street is currently expecting the Fed to implement two or three rate cuts by the end of 2025.

Wall Street Performance

On Tuesday, Wall Street faced a setback with the S&P 500 index dropping 1.1% to 5,614.66. This decline is part of a turbulent trend where the index previously fell 10% from its all-time high before recovering over the last two days. The Dow Jones Industrial Average was down by 0.6% to 41,581.31, and the Nasdaq composite fell by 1.7% to 17,504.12.

Among the stocks that weighed heavily on the market was Tesla, which saw a decline of 5.3%. Concerns surrounding falling sales and criticism of CEO Elon Musk regarding government spending cuts continue to affect the company's performance. Competing electric vehicle manufacturer, BYD, recently introduced an ultra-fast charging system that poses a new challenge for Tesla.

Additionally, Alphabet's shares fell by 2.2% after announcing its acquisition of cybersecurity firm Wiz for $32 billion, marking the company's most significant purchase to date. This move aims to enhance Google’s cloud computing capabilities amid the growing demand for artificial intelligence technologies.

Big Tech Trends

The decline observed in major tech stocks reflects a significant shift in market dynamics, especially for those that had previously thrived during the AI technology boom. Stocks like Nvidia dropped 3.3%, while Palantir Technologies and Super Micro Computer saw declines of 4% and 9.6%, respectively.

Concerns about the economy are compounded by uncertainties surrounding trade policies and tariffs introduced by the government, leading to hesitance among consumers and businesses about future spending. This situation poses difficulties for the Federal Reserve as it navigates the decision on interest rates.

Energy and Currency Trading

In the energy sector, benchmark U.S. crude oil prices fell by 26 cents, settling at $66.65 a barrel, while Brent crude, the international standard, dropped by 23 cents to $69.89 a barrel.

On the currency front, the U.S. dollar gained slightly against the Japanese yen, trading at 149.42 yen, up from 149.25 yen. The euro was valued at $1.0941, marking a decrease from the prior rate of $1.0946.

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