Asian markets followed Wall Street lower on Thursday as investors awaited the results of the Bank of Japan’s first policy meeting under new governor Kazuo Ueda. Concerns over the health of American regional banks outweighed better-than-expected technology profits.
As of 9.30 A.M. Bangkok time, the Nikkei 225 in Japan fell 0.31%. It is widely speculated that Ueda will continue his predecessor Haruhiko Kuroda’s ultra loose monetary policy for the time being, but will eventually work to wean the economy off of this policy.
Australia’s S&P/ASX 200 was down 0.48%.
South Korea’s Kospi shed 0.13%, while Hong Kong’s Hang Seng index fell 0.1%.
The Shanghai Composite in mainland China, meanwhile, gained 0.22%.
U.S. stock markets had a mixed close yesterday as worries over the banking sector overshadowed Big Tech earnings. The Dow Jones Industrial Average dropped 0.68 points, wiping off its early gains. S&P 500 fell 0.38% while the tech-heavy Nasdaq Composite rose 0.47 %, paring gains after opening the day up 1.43 %.
On Wednesday, First Republic Bank shares dropped another 30% after dropping over 50% the day before. The Federal Reserve may impose borrowing limits on the US regional lender.
Evercore ISI’s head of central bank strategy Krishna Guha stated in a note that the Federal Reserve may slow the pace of its interest-rate rises if credit conditions tighten due to the banking turmoil. It’s possible, he continued, that events involving First Republic could transpire in such a way as to convince the FOMC to forgo May and instead signal an increase in June.