Asian shares firm as Fed cut bets lift sentiment
Asian markets steadied on Friday, wrapping up a turbulent November with modest gains as expectations of a U.S. Federal Reserve rate cut strengthened. The shift in sentiment fuelled a rally in Treasuries, which are on track for a fourth straight month of gains.
With U.S. markets closed for Thanksgiving and set for a shortened session, global trading remained subdued. MSCI’s Asia-Pacific index outside Japan was flat but headed for a 3% weekly rise, its first in four weeks, though still down 2.7% for the month. Japan’s Nikkei was also steady, set for a 3.2% weekly gain but down 4.3% in November. South Korea’s index slipped 1% after the central bank held rates, though it remained up for the week, News.Az reports, citing Reuters.
November proved unusually volatile for global equities as concerns over tech valuations and a record 43-day U.S. government shutdown pressured markets. Bitcoin fell 17% over the month. However, comments from key Fed officials, including Christopher Waller and John Williams, revived confidence, pushing Fed funds futures to price an 85% chance of a December rate cut — a sharp jump from 30% a week earlier.
Chinese blue-chips dipped slightly, while Hong Kong’s Hang Seng edged higher. In Japan, core inflation in Tokyo rose 2.8% in November, adding to speculation that the Bank of Japan may raise rates as early as next month. The yen held near 156 per dollar as traders watched for possible intervention.
The U.S. dollar was steady but headed for its biggest weekly drop since July. The Australian and New Zealand dollars outperformed as markets bet their rate-cut cycles were nearing an end. Treasury yields stayed near 4% and were set for a monthly decline.
Oil was little changed but on track for a fourth straight monthly loss, while gold rose 0.7% to extend its monthly gain to 4.6%, still below its recent record.
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