FX.co ★ Asian Markets Trade Mixed After Fed Decision

On Thursday, investor sentiment throughout Asian markets has been mixed as a result of the U.S Federal Reserve's decision to not alter interest rates, which was broadly expected. The central bank cited the stall in progress towards their 2% inflation target as the major reason for this decision. Fed Chair Powell made it clear that the possibility of a rate hike in the near future was unlikely.

The Australian market recovered some of its recent losses, buoyed by a mixed performance from Wall Street. The S&P/ASX 200 index rose above the 7,600 mark, boosted by gains in financial stocks and gold miners, although technology stocks and financials brought some balance to this rise. As a result, the S&P/ASX 200 increased by 37.80 points or 0.50% to 7,607.70. Notable movements included major miners such as Rio Tinto and Fortescue Metals witnessing slight declines, whilst oil stocks such as Woodside Energy suffered losses of over 1%.

Tech company Afterpay's shares plunged more than 7%, whereas its peer Appen grew by nearly 1%. Despite the general decline of oil stocks, the banking and gold mining sectors showed signs of improvement. Commonwealth Bank, ANZ Banking and National Australia Bank each grew by almost 1%, and Evolution Mining rose by 1.5%.

Investors punished Bapcor after it downgraded its profit guidance, causing its shares to dive by 31%. Meanwhile, supermarket giant Woolworths had its shares drop by 4% post a disappointing earnings announcement.

Meanwhile, in Japan, despite a hesitant market opening, the Nikkei 225 showed modest growth, ending the morning session slightly below the 38,300 mark. SoftBank Group shares dropped by almost 1% while shares in Toyota decreased slightly. Sumitomo Mitsui Financial experienced losses of almost 2%. However, these losses were somewhat counterbalanced by gains from companies like Kansai Electric Power, which rose by almost 5%, and Sumitomo, which saw an increase of 4%.

Moreover, the Bank of Japan's Monetary Policy Board revealed that the bank's 2% inflation target was within sight. This led the BoJ to increase its interest rates for the first time in almost two decades, making it the last central bank globally to do so. The bank's overnight interest rate increased to around 0 to 0.1% from -0.1%.The Bank of Japan has announced a 2.1 percent annual increase in the country's monetary base in April, equating to 689.896 trillion yen. This reflects an increase from 1.6 percent the previous month, while the adjusted monetary base saw a year-on-year spike of 11.4 percent.

In the foreign exchange market, the U.S. dollar was trading higher against the Japanese yen, falling into the 155 yen-range on Thursday.

Turning to the Asian markets: Hong Kong experienced a 1.3 percent increase, whereas Malaysia and Singapore experienced more modest growth of 0.1 and 0.2 percent, respectively. Meanwhile, the markets in South Korea, Taiwan, and Indonesia saw decreases ranging between 0.1 and 0.8 percent. New Zealand's market remained relatively stable, and China's market was closed due to Labor Day.

Reacting to the Federal Reserve's monetary policy announcement on Wednesday afternoon, Wall Street experienced significant volatility. The announcement initially caused a surge in the major averages, but they retreated as the day closed. This left us with mixed results, as while the Dow Jones Industrial Average increased by 87.37 points or 0.2 percent to 37,903.29, the Nasdaq and the S&P 500 both decreased, by 52.34 points (or 0.3 percent) to 15,605.48 and 17.30 points (or 0.3 percent) to 5,018.39 respectively.

While most major European markets were closed, UK stocks saw a slight decrease. The FTSE 100 ended the day 0.3 percent lower.

In the commodities market, crude oil prices hit a seven-week low after data revealed an unexpected surge in U.S. crude inventories last week. Consequently, West Texas Intermediate Crude oil futures for June ended lower by $2.93 at $79.00 a barrel, the lowest settlement since March 12.