Global Markets Shift Amid Fed Signals: The global financial markets have shown mixed performance recently,
influenced by U.S. Federal Reserve signals and international economic developments.
While Wall Street indices reached record highs, Asian stocks declined due to investor concerns.

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Wall Street Indices Rise
Asian Stocks Decline

Market and Currency Effects

Investor Focus on Alibaba Earnings

Oil Prices Stabilize Amid Supply Concerns

Wall Street Indices Rise

U.S. stock indices closed at all-time highs as traders ignored indications
that the Federal Reserve is in no rush to cut interest rates.
As in the previous session, stocks gained momentum in the final hours of trading,
following the Fed minutes reinforcing its cautious stance amid economic strength and persistent inflation.

Peter Boockvar, author of The Boock Report, stated:
“They will wait before cutting rates again,” referring to the Fed’s cautious stance.
He added that his expectation of a rate cut remains, as policymakers still lean towards monetary easing.
He also noted that the Fed’s comments on the balance sheet may be one reason for slightly lower yields.

Asian Stocks Decline

Conversely, Asian stocks declined on Thursday after the Federal Reserve meeting minutes
revealed a cautious stance on interest rate cuts and President Donald Trump’s call for additional tariffs.

Stocks across the Asia-Pacific region fell, with China and Hong Kong indices opening lower.
U.S. stock futures also declined, signaling that the S&P 500 could erase part of its Wednesday gains.
Meanwhile, Treasury bonds remained stable,
and gold hovered near record highs,
reinforcing demand for safe-haven assets.

The Federal Reserve minutes showed that policymakers preferred to keep interest
rates steady amid persistent inflation and economic uncertainty in January.
Officials also discussed the potential slowdown or halt of balance sheet reduction
known as quantitative tightening—until the U.S. debt ceiling crisis is resolved.

Peter Boockvar commented:
“They will monitor the situation before making another rate cut decision.” He added:
“There is still a tendency towards monetary easing.
The Federal Reserve’s stance on the balance sheet may also contribute to slightly lower yields.”

Market and Currency Effects

Japanese stocks faced downward pressure due to a stronger yen,
which rose for the second consecutive day against the U.S. dollar, trading around 151 yen per dollar.
The U.S. dollar index slightly declined after previous session gains.

Financial markets remained largely unaffected despite Trump’s remarks on government spending cuts and additional tariffs.
He also referenced the strong performance of Nasdaq, Dow Jones, and Bitcoin in recent months.

Bitcoin, a key element in the “Trump trade,” peaked
after the November U.S. elections but has since declined by approximately 10% from its January highs.
The Australian dollar strengthened as job market data exceeded expectations.

Investor Focus on Alibaba Earnings

Investors closely monitor Alibaba’s earnings as the company faces a key test
after its market value surged by over $110 billion due to large-scale purchases via “Deep Sec.”

Elsewhere:

Rio Tinto Group reported a drop in annual profits.
Fortescue announced a 53% decline in first-half earnings, reflecting weaker iron ore prices due to sluggish Chinese demand.

Oil Prices Stabilize Amid Supply Concerns

Oil prices remained stable on Thursday after gains in the previous session.
This was amid continued uncertainty over supply from Russia and Kazakhstan and OPEC+ efforts to regulate production.

Global Markets Shift Amid Fed Signals

Global Markets Shift Amid Fed Signals

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