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Fed Rate Hike Jolts Asian Markets
18 Sep
Summary
- US Federal Reserve increased interest rates for the first time in three years.
- Hong Kong's Hang Seng Index is trading just above 24,710 points.
- Crude oil prices dropped significantly following the Fed's rate decision.
The Hong Kong stock market has seen a modest recovery, trading higher in two out of the last three sessions after a five-day losing streak. The Hang Seng Index is currently positioned just above the 24,710-point mark.
Globally, Asian markets are expected to open lower following the U.S. Federal Reserve's decision to raise interest rates for the first time since July 2023. This move, aimed at combating persistent inflation, led to widespread negative sentiment.
On Wednesday, the Hang Seng Index closed up 46.54 points, or 0.19 percent, at 24,713.78. Gains in metals and technology sectors were counterbalanced by losses in financial shares and retailers.
The U.S. stock market experienced a late-day slump after the Fed's announcement. Major averages, including the Dow, NASDAQ, and S&P 500, finished lower. Fed Chair Kevin Warsh's commentary highlighted ongoing inflation concerns, with projections indicating a continued path of interest rate increases.
In commodity markets, crude oil prices plummeted by 3.41 percent. This decline was attributed to the Federal Reserve's interest rate decision and reports of increased crude supply from Saudi Arabia via Oman, easing supply-related worries.
