Global Markets Swerve Ahead of Fed Rates Decision, BoJ Policy Weighs
Global equities markets were broadly negative, with sell pressure across Asia and the United States, while European stocks bucked the trend amid shifting investor sentiment.
South Korea’s Kospi index dropped as much as 8.1%, its lowest level since April 20, as memory giants Samsung Electronics and SK Hynix each slumped more than 9%.
Japan’s chip-heavy Nikkei 225 fell about 4%. New mapping of the AI industry’s biggest players shows chipmakers, cloud giants, and AI labs increasingly investing in one another and buying from one another in the same closed loop, while Chinese rivals close the technology gap at a fraction of the cost.
In a brief, First National Bank (FNB) reported a sharp sell-off in Japanese equities dominated overnight price action, with the Nikkei 225 tumbling 3.92% as a stronger yen weighed heavily on export-sensitive stocks and investors reassessed the Bank of Japan’s policy trajectory following recent hawkish commentary.
The Hang Seng Index slipped 0.11%, reflecting cautious sentiment across the broader Asia-Pacific region, while the ASX 200 bucked the regional trend and advanced 0.45%, supported by resilient domestic demand data.
In the US, the Federal Reserve (Fed) remains in focus ahead of its policy meeting later this week, with Wall Street’s prior session seeing a mixed outcome – the Dow Jones closed up 0.51%, and the S&P 500 was barely changed.
Meanwhile, the Nasdaq Composite slipped 0.18%, as a third consecutive day of semiconductor losses driven by mounting investor scepticism over artificial intelligence spending returns offset relief from a pause in US strikes against Iran that pushed oil lower.
European equities closed broadly higher, with the FTSE 100 up 0.42% and the DAX gaining 1.04%, led by SAP’s 7.9% surge following well-received results.
Euro Stoxx 50 was barely changed as ASML slumped on reports that a Chinese state-backed firm had reportedly begun producing competing chipmaking machines, offsetting the broader relief from a sharp retreat in oil prices.
The Johannesburg Stock Exchange (JSE) is set for a weaker open this morning as global futures point broadly lower and commodities trade under pressure. The ASX Metals and Mining Index is down 1.55%, a negative read across for local resource counters – gold and platinum are both softer, weighing on gold miners and precious metals counters.
Tencent, however, is trading higher, up 0.36%, a move that is likely to provide some support for Naspers and Prosus on the JSE, offering a slight counterweight to the broader negative tone.
The JSE closed broadly higher on Monday, with the All Share Index gaining 0.65% to 110 110 points and the Top 40 rising 0.66% to 102 103 points, as a de-escalation in the US-Iran conflict drove a sharp improvement in global risk appetite.
The dominant sentiment driver was the announcement of a pause in US-Iran hostilities, which sent oil prices sharply lower and lifted emerging-market assets broadly.
Industrials (+1.89%) were the session’s top gainer, bolstered by strong momentum in Industrial Materials (+2.93%) and Industrial Support Services (+2.85%), followed by Financials (+0.74%), which extended gains for the second consecutive session.
Resources (-0.68%) bucked the trend and closed in negative territory amid weakness in mining counters. Nigerian Naira Rallies, Official Exchange Rate Closes at N1367
