Asian Shares Mixed as U.S. Interest Rate Expectations Resurface

Asian shares were trading mixed on Wednesday as concerns over high U.S. interest rates resurfaced, impacting markets across the region. Japan’s Nikkei 225 dipped 0.5%, while Australia’s S&P/ASX 200 edged up slightly. South Korea’s Kospi remained steady, Hong Kong’s Hang Seng slipped, and the Shanghai Composite gained.

The mixed reaction came after Federal Reserve Chairman Jerome Powell indicated that the central bank is hesitant to cut interest rates, citing the need for more confidence in inflation heading down to its 2% target. This news has dampened risk appetite among investors, with many calling for patience in easing rates.

On Wall Street, the S&P 500 and Nasdaq fell, while the Dow Jones Industrial Average rose. Treasury yields rose following Powell’s comments, leading to a sell-off in stocks. Traders are now expecting fewer rate cuts from the Fed this year, with some even betting on no cuts at all.

Companies are under pressure to report strong profits and revenue as interest rates are unlikely to provide much support to stock prices in the near future. Meanwhile, Donald Trump’s social-media company saw its stock slump further after announcing a new streaming service on its Truth Social app.

In energy trading, benchmark U.S. crude and Brent crude both fell, while in currency trading, the U.S. dollar inched down against the Japanese yen and the euro. The uncertainty surrounding interest rates and inflation continues to weigh on global markets, with investors closely watching for any further developments from the Fed.