---
title: "Equities pull back ahead of central bank events: markets wrap"
description: "Stocks in Asia came off session highs ahead of key events from the Federal Reserve and the Bank of Japan that will help define the global rates trajectory. The dollar rebounded."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "Business Maverick"
author: "Bloomberg"
author_url: "https://www.dailymaverick.co.za/author/bloomberg/"
canonical_url: "https://www.dailymaverick.co.za/article/2024-08-22-equities-pull-back-ahead-of-central-bank-events-markets-wrap/"
published: "2024-08-22T05:32:28"
updated: "2024-08-22T05:32:29"
lang: "en-ZA"
word_count: 520
---

# Equities pull back ahead of central bank events: markets wrap

> Stocks in Asia came off session highs ahead of key events from the Federal Reserve and the Bank of Japan that will help define the global rates trajectory. The dollar rebounded.

By Bloomberg · Published 22 August 2024, 07:32 SAST · Updated 22 August 2024, 07:32 SAST

## Content

Equity benchmarks in Japan and Hong Kong trimmed their advances, while Korea’s Kospi turned lower. Chinese equities fell. That came after the S&P 500 and Nasdaq 100 indexes posted modest gains on further signs the Fed will cut interest rates.

Fed easing wagers were bolstered as minutes from the latest meeting [showed](https://www.bloomberg.com/news/articles/2024-08-21/fed-minutes-show-several-saw-case-for-cutting-rates-in-july) several officials acknowledged a plausible case for cutting rates. There’s a degree of caution however ahead of Chair Jerome Powell’s speech Friday at the Jackson Hole economic symposium, where he will have a chance to offer investors further clarity.

“It looks like markets are continuing to stabilize after the panic that emerged a couple of weeks ago amid US recession concerns, yen carry trade and momentum unwind,” said Chetan Seth, an Asia-Pacific equity strategist at Nomura Holdings Inc. “It seems markets are now climbing the proverbial wall of worry this week which we view as a relatively quieter one.”

A Bloomberg gauge of dollar’s strength advanced 0.1%, a small uptick after a bout of weakness. The yen weakened. BOJ Governor Kazuo Ueda will face intense [market scrutiny](https://www.bloomberg.com/news/articles/2024-08-21/boj-s-ueda-is-set-to-face-intense-scrutiny-after-market-chaos) on Friday when he speaks to lawmakers, after the central bank’s hawkish signals contributed to the global market turmoil earlier this month.

US government debt was little changed in Asian trading after gains for short-dated Treasuries in the prior session sent two-year yields falling almost 10 basis points before paring the move. Traders were once again pricing in more than 1 percentage point worth of Fed easing by the end of 2024, starting next month.

Market expectations of US and Japan monetary policy outlooks have been driving the currency pair, “but actually, it is dominated by the US side developments,” and any comments from Jackson Hole will be important, said Junya Tanase, chief Japan FX strategist at JPMorgan Chase & Co.

A likely revision to [US job growth](https://www.bloomberg.com/news/articles/2024-08-21/us-payrolls-likely-to-be-818-000-lower-per-preliminary-revision) added further evidence for traders to expect a September rate cut. The number of workers on payrolls will probably be revised down by 818,000 for the 12 months through March — or around 68,000 less each month — according to the Bureau of Labor Statistics’ preliminary benchmark revision. It was the largest downward revision since 2009.

Elsewhere, Bank of Korea Governor Rhee Chang-yong said a few members were open to a rate cut in the next three months, after keeping borrowing costs [steady](https://www.bloomberg.com/news/articles/2024-08-22/bank-of-korea-holds-policy-rate-steady-to-rein-in-housing-market).

Chinese tech stocks edged higher as Xiaomi Corp.’s better-than-expected second quarter results eased some concern over earnings.

#### Jackson Hole

To Jennifer McKeown at Capital Economics, central bankers are unlikely to offer much forward guidance at the Jackson Hole economic symposium, preferring to stress their “data dependence.”

“Since most economies are expanding, inflation is easing back to target and financial markets have stabilized after the recession scare a few weeks ago, there is less pressure for them to steer markets than there has been around past events,” she noted. “But they risk keeping rates too high for too long.”

In commodities, oil edged lower Thursday, extending a decline in the prior session. Gold also fell after trading near a record high Wednesday on the expectations of a Fed rate cut.