Shares were mostly lower in Asia yesterday, with markets in China, Japan and some other markets still closed for holidays.
Hong Kong and Seoul fell more than 1% and oil prices were higher.
On Tuesday, stocks closed modestly higher on Wall Street as investors waited for today’s [Macau time] decision by the Federal Reserve on interest rates.
The Fed is expected to raise its benchmark rate by twice the usual amount this week as it steps up its fight against inflation, which is at a four-decade high. It has already raised its key overnight rate once, the first such increase since 2018, and Wall Street is expecting several big increases over the coming months.
“All eyes are peering toward the FOMC meeting and a rate hike is an absolute given,” Clifford Bennett, chief economist at ACY Securities, said in a commentary.
Market players might pick up bargains on the assumption that the rate increase has already been taken into account. But he added that “this excludes the on-going shock to consumers and particularly mortgage holders that will reverberate in an accelerating fashion throughout the economy. This ‘pain’ process will likely continue for the next one to three years in the real world.”
