Tue, January 31, 2023

Coronavirus, U.S. Federal Reserve and Stocks in Asia

Federal Reserve and lawmakers

On Thursday, a combination of factors influenced the stocks across Asia. One of the factors which affected the markets is the U.S. Federal Reserve.

Two days ago, the Federal Open Market Committee made the decision to keep the benchmark rate in a range between 1.5% and 1.75%. For the second meeting in a row, Federal Reserve decides not to change the rates. According to the stamen released by the committee, the labor market remains in a strong position. The economy is growing at a moderate rate.

Federal Reserve Chairman Jerome Powell commented on the Coronavirus. He stated that the central bank is closely monitoring the situation. However, he mentioned that it would take time to assess the impact on the global economy.

Stocks in Asia and CoronavirusStocks in China

Stock markets across the Asia Pacific region experienced problems due to the coronavirus outbreak.

Hong Kong’s Hang Seng index dropped 2.62% to close at 26,449.13. The shares of travel-related companies such as China Southern Airlines and Cathay Pacific fell on Thursday.

Shares of China Southern Airlines dropped 3.34% while Cathay Pacific fell 2.13%.

Unfortunately, shares of gaming companies also fell on January 30. In the case of Wynn Macau, shares fell 5.21%. At the same time, shares of another gaming company Melco International Development declined 5.35%.

In Taiwan, the Taiex index dropped 5.7% to close at 11,421.74.

The index declined due to the Hon Hai Precession Industry. Shares of manufacturing giant and major Apple supplier, also known as Foxconn, fell 9.97%.

In Japan, the Nikkei 225 index fell 1.72% to close at 22,977.75. Another Japanese stock index Topix also declined on Thursday. Its index dropped 1.48% to end its trading day at 1,674.77.

In South Korea, the Kospi index fell 1.71% to close at 2,148.00.  Samsung Electronics reported that the fourth quarter operating profit declined by about 34% compared with the same period in 2018.

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