Stock market today: Asian shares trade mixed as investors look to central banks

By YURI KAGEYAMA
AP Business Writer

TOKYO (AP) — Asian shares are mixed Thursday in lackluster trading.

Japan’s Nikkei 225 reversed course from earlier losses and finished at 38,807.38, up 0.3%. Nissan Motor Co. stock jumped 2.2% after an unconfirmed Japanese media report that the automaker behind the Leaf electric car was about to enter an agreement on EVs with domestic rival Honda Motor Co. Honda shares rose 1.1%.

Both Nissan and Honda declined comment.

Sydney’s S&P/ASX 200 slipped 0.2% to 7,713.60. South Korea’s Kospi added 0.9% to 2,718.76. Hong Kong’s Hang Seng lost 0.9% to 16,929.12, while the Shanghai Composite fell 0.2% to 3,038.23.

“In a significant turn of events, there’s increasing speculation that the Bank of Japan might consider ending its negative interest rate policy in its upcoming meeting, spurred by substantial wage hikes by major Japanese firms,” said Anderson Alves at ActivTrades.

The Japanese central bank has set a target of 2% inflation. The Bank of Japan will hold a two-day monetary policy meeting next week.

On Wall Street, the S&P 500 slipped 9.96 points, or 0.2%, from its all-time high set a day before to 5,165.31. The Dow Jones Industrial Average rose 37.83, or 0.1%, to 39,043.32 and pulled within 90 points of its record set last month. The Nasdaq composite dipped 87.87, or 0.5%, to 16,177.77.

The bond market was also relatively quiet, with Treasury yields ticking higher.

Oil prices have been on a general upswing so far this year, which has helped keep inflation a bit higher than economists expected. That higher inflation has in turn dashed Wall Street’s hopes that the Federal Reserve could start offering relief at its meeting next week by cutting interest rates.

But the expectation is still for the Fed to begin cutting rates in June, because the longer-term trend for inflation seems to remain downward. The Fed’s main interest rate is at its highest level since 2001, and reductions would release pressure on the economy and financial system. Stocks have already rallied in part on expectations for such cuts.

Their nearly nonstop run since late October, though, has raised criticism that it was overdone.

In the bond market, the yield on the 10-year Treasury rose from 4.15% late Tuesday to 4.18% on Wednesday. It helps set rates for mortgages and loans for all kinds of companies and other borrowers.

The two-year Treasury yield also climbed. It more closely follows expectations for the Fed, and it rose to 4.62% from 4.58% late Tuesday and from 4.20% at the start of February. It had earlier dropped on strong expectations for coming cuts to interest rates by the Fed.

In energy trading, benchmark U.S. crude added 11 cents to $79.83 a barrel. Brent crude, the international standard, rose 14 cents to $84.17 a barrel.

In currency trading, the U.S. dollar rose to 147.96 Japanese yen from 147.74 yen. The euro cost $1.0945, down from $1.0953.

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AP Business Writer Stan Choe contributed.