Stock price information displayed in the lobby of the Euronext NV stock exchange in Paris, France, on Wednesday, 14 December 2022. (Photo: Nathan Laine/Bloomberg) Stock indexes in China dropped as home prices fell the most in eight years, followed by shares in Japan and South Korea. US futures dropped, effectively erasing the 0.2% gain in the S&P 500 on Wednesday.
Treasuries were little changed in Asia after a sell-off Wednesday where the 10-year rate rose eight basis points to above 4.5%. The greenback was steady in Asian trading after gaining ground against major currencies in the previous session, including the yen, which weakened beyond 151 per dollar.
Investors were also looking ahead to corporate earnings from Alibaba Group Holding Ltd. and NetEase Inc. later today following encouraging results from JD.com Inc and Tencent Holdings Ltd.
In the US, retail sales slowed in October and prior months were revised higher — suggesting some resiliency going into the holiday season. Prices paid to US producers unexpectedly declined by the most since April 2020.
“We got more Goldilocks today,” said David Russell, global head of market strategy at TradeStation. “Price growth is moderating, but with strong demand on the sidelines. The soft landing is taking shape.”
Despite the growing hopes US inflation will further dissipate toward the Fed’s 2% target, a growing number of high-profile Wall Street figures have urged caution.
The bond market is at risk of leaning too heavily toward rate cuts next year as “the inflation problem is far from being solved,” according to Daniel Ivascyn, chief investment officer at Pacific Investment Management Co. He joined Jamie Dimon, chief executive officer of JPMorgan Chase & Co. and Ken Griffin, founder of Citadel, who have both this week warned inflation may be more persistent than markets are pricing.
Elsewhere in Asia, the value of imports in Japan gained 1.6% from a year earlier in October, outpacing estimates of a 1% increase while in China new home prices are expected later today. That follows reports earlier in the week showing resilient Chinese consumer spending, and also a plan to support the property sector that buoyed developers on Wednesday.
Oil extended declines after a government report showed swelling US crude inventories. Gold was steady and Bitcoin traded above $37,500.