Investors Focused on Fed Jackson Hole Symposium

SINGAPORE — Asia-Pacific markets traded mixed Friday as investors remained cautious ahead of the Federal Reserve’s annual Jackson Hole symposium, where Fed chairman Jerome Powell able to speak.

In Australia, the benchmark ASX 200 recovered early losses of nearly 0.3% to trade near flat. The heavily weighted financial sub-index reversed from a 0.4% loss to a 0.21% gain. The energy and materials sectors fell by 0.18% and 0.28% respectively.

The Nikkei 225 erased some of its previous declines, but the Japanese index still fell 0.33%, while the Topix index fell 0.36%. South Korea’s Kospic turned positive and traded 0.32% higher and the Hang Seng Index in Hong Kong rose 0.55%.

Mainland Chinese stocks also rose: The Shanghai composite increased by 0.53% while the Shenzhen component: 0.45% added.

The Fed’s much-anticipated Jackson Hole symposium will take place virtually on Friday. Investors expect to hear what Powell thinks about the state of the US economy and how he could guide the central bank in exiting the measures it has taken to save the economy from the Covid-19 pandemic.

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“Fed chairmen have a track record of foreshadowing major policy announcements at Jackson Hole, and some investors believe Powell will provide further clues as to the timing of a tapering announcement, which could come once the FOMC meeting takes place next month,” Tapas Strickland, director of economics and markets at the National Australia Bank, wrote in a Friday morning note.

Strickland pointed out that an announcement about tapering is “very likely” to come before the end of the year.

In overnight trading, the three major US indices ended lower during Thursday’s regular trading session. The Dow broke a four-day win streak, while the S&P 500 and the Nasdaq Composite both broke a five-day win streak.

Currencies and Oil

In the foreign exchange market, the U.S. dollar last traded at 93,063 against a basket of his peers. The greenback fell from levels above the 93,600 reached the previous week.

The Japanese Yen traded at 109.99 against the dollar, stronger than a previous level around 110.09. Meanwhile, the Australian dollar changed hands for $0.7239.

Oil prices rose during Asian trading hours on Friday, where US crude oil added 0.83% to $67.98, while the global benchmark Brent rose 0.77% to $71.62. Prices have dropped overnight as new Covid outbreaks raised concerns about the recovery in global oil demand.

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