Asian stocks were mixed Friday with the yen moved between gains and losses after the latest update on inflation bolstered Wall Street’s belief that relief on interest rates may come as soon as September.
U.S. futures were mixed and oil prices rose.
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The USD/JPY currency dropped 2.1% overnight and traded as low as 157.43, fueling speculation that Japanese authorities may have intervened to amplify the impact of the dovish US inflation data.
On Friday, the U.S. dollar rose to 159.26 Japanese yen from 158.80 yen.
Tokyo’s Nikkei 225 index lost 2% to 41,388.92.
Hong Kong’s Hang Seng index climbed 1.9% to 18,165.33 while the Shanghai Composite index was down 0.2% to 32,965.52 after data showed that China’s exports increased by 8.6% in June, better than the market expectation.
Australia’s S&P/ASX 200 was up 0.8% to 7,952.20. South Korea’s Kospi slipped 1.2% to 2,857.11.
Elsewhere, Bangkok’s SET edged less than 0.1% higher. Taiwan’s Taiex declined 2%, with Taiwan Semiconductor losing 3.7% in morning trading. The company earlier said that its revenue climbed nearly 33% in June compared with the same period last year.
Such a trend followed the overnight trading at Wall Street, where four out of every five stocks in the S&P 500 index climbed, though pullbacks for Nvidia, Microsoft and a handful of other highly influential companies masked that underlying strength. Those giants have been the market’s biggest winners amid a frenzy around artificial-intelligence technology, causing critics to say they had become too pricey, and they helped drag the S&P 500 down 0.9% from its all-time high set a day before.
The drops for Big Tech stocks also pulled the Nasdaq composite down 2% from its own record. The drops broke seven-day winning streaks for both the S&P 500 and Nasdaq composite. The Dow Jones Industrial Average, which has less of an emphasis on tech, rose 32 points, or 0.1%.
The direction was decidedly upward for the majority of stocks on Wall Street, particularly housing-related companies, real-estate owners and others that benefit from easier interest rates. SBA Communications, which owns towers and other sites used for wireless communications infrastructure, jumped 7.5% for the biggest gain in the S&P 500.
The day’s action was even stronger in the bond market, where yields tumbled as traders built bets for the Federal Reserve to soon begin lowering its main interest rate. It’s been sitting for nearly a year at its highest level in more than two decades.
Wall Street wants lower interest rates to release pressure that’s built up on the economy because of how expensive it’s become to borrow money to buy houses, cars or anything on credit cards. Fed officials, though, have been saying they want to see “more good data” on inflation before making a move.
Wall Street saw Thursday’s report, which showed milder price increases than expected from a year earlier for gasoline, cars and other things U.S. consumers bought during June, as providing just that.
Following the report’s release, Treasury yields tumbled immediately. The yield on the 10-year Treasury dropped to 4.20% from 4.28% late Wednesday and from 4.70% in April. That’s a major move for the bond market and provides a big lift for stock prices.
Lower yields helped real-estate owners and utilities lead the way in the stock market. Falling bond yields make those stocks’ relatively high dividends more attractive to investors seeking income.
Real-estate investment trusts in the S&P 500, including SBA Communications, jumped 2.7% for the biggest gain among the 11 sectors that make up the index. Utility stocks were close behind with a gain of 1.8%.
Homebuilders were also strong on hopes that lower mortgage rates will juice the industry. D.R. Horton climbed 7.3%, and Lennar rose 6.9% for some of the biggest gains in the S&P 500. Mohawk Industries, which makes flooring for homes, jumped 7.4%.
All told, the S&P 500 fell 0.9% to 5,584.54. The Dow rose 0.1% to 39,753.75, and the Nasdaq composite dropped 2% to 18,283.41.
In other dealings, U.S. benchmark crude oil gained 31 cents to $82.93 per barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the international standard, picked up 21 cents to $85.61 per barrel.
The euro rose to $1.0869 from $1.0865.