CANBERA (dpa-AFX) - Asian stock market are mostly lower on Thursday following the negative cues overnight from Wall Street after the U.S. Federal Reserve cut interest rates by 25 basis points as expected. This marked the first rate cut by the Fed since December 2008.
However, comments from Federal Reserve Chairman Jerome Powell dampened hopes of further rate cuts later this year. In addition, the U.S. and China ended another round of trade talks on Wednesday without much progress. Investors also digested data that showed China's manufacturing sector contracted slightly in July, but at a slower than expected pace.
The Australian market is extending losses from the previous session. The benchmark S&P/ASX 200 Index is declining 16.60 points or 0.24 percent to 6,796.00, after touching a low of 6,780.60 earlier. The broader All Ordinaries Index is down 16.00 points or 0.23 percent to 6,880.70. Australian stocks closed lower on Wednesday.
In the mining space, BHP Group and Rio Tinto are declining more than 1 percent each, while Fortescue Metals is losing almost 2 percent.
Gold miners are sharply lower after gold prices declined overnight. Newcrest Mining is losing almost 4 percent and Evolution Mining is lower by more than 4 percent.
Among the big four banks, ANZ Banking, National Australia Bank and Westpac are higher in a range of 0.4 percent to 0.5 percent, while Commonwealth Bank is lower by 0.5 percent.
Oil stocks are mixed even as crude oil prices rose overnight. Santos is down 0.2 percent and Woodside Petroleum is edging up 0.1 percent, while Oil Search is unchanged.
Qantas has put on hold its plan to acquire a majority stake in ASX-listed regional rival Alliance Aviation after the ACCC expressed concerns about the move's impact and launched an investigation. Shares of Qantas are rising 0.4 percent.
Nufarm's shares are gaining more than 7 percent despite the company lowering its earnings outlook for the year. The agricultural chemicals company also said it plans to raise A$97 million through a share placement with its strategic Japanese partner, Sumitomo Chemical Co.
On the economic front, the latest survey from the Australian Industry Group revealed that the manufacturing sector in Australia moved back into expansion territory in July, with a Performance of Manufacturing Index score of 51.3. That's up from 49.4 in June and it moves back above the boom-or-bust line of 50 that separates expansion from contraction.
Australia will also see July numbers for the Reserve Bank of Australia's commodity price index and second-quarter data for import and export prices today.
In the currency market, the Australian dollar is lower against the U.S. dollar on Thursday. The local currency was quoted at $0.6834, compared to $0.6893 on Wednesday.
The Japanese market opened lower following the negative cues overnight from Wall Street. However, the market has recovered and is now modestly higher.
The benchmark Nikkei 225 Index is adding 22.54 points or 0.10 percent to 21,544.07, after touching a low of 21,288.90 earlier. Japanese stocks closed lower on Wednesday.
The major exporters are mixed despite a weaker yen. Mitsubishi Electric and Canon are advancing almost 1 percent each, while Panasonic is declining 2 percent and Sony is lower by almost 1 percent.
In the tech space, Advantest is rising more than 2 percent, while Tokyo Electron is lower by 0.6 percent.
Market heavyweight SoftBank is advancing more than 1 percent, while Fast Retailing is edging down 0.1 percent. In the auto sector, Honda Motor is rising 0.6 percent and Toyota Motor is adding more than 1 percent.
Mitsubishi Motors said it will manufacture plug-in hybrids in Thailand starting in early 2021 and added that it has now exported a total of 4 million vehicles from the Southeast Asian nation. The automaker's shares are rising more than 1 percent.
Among oil stocks, Inpex is higher by 0.7 percent and Japan Petroleum is up more than 1 percent after crude oil prices rose overnight.
Among the other major gainers, Mitsui E&S is gaining more than 11 percent, Nomura Holdings is rising almost 9 percent and TDK Corp. is higher by almost 7 percent.
On the flip side, Tokyo Seikan Group is losing more than 8 percent, while Nippon Express Co. and Yamato Holdings are lower by more than 7 percent each. Sumitomo Heavy Industries is declining more than 5 percent.
In the currency market, the U.S. dollar is trading in the lower 109 yen range on Thursday.
Elsewhere in Asia, Shanghai, New Zealand, Singapore, Malaysia, Hong Kong and Taiwan are also lower, while South Korea and Indonesia are modestly higher.
On Wall Street, stocks fell sharply in reaction to comments from Federal Reserve Chairman Jerome Powell offsetting optimism about future interest rate cuts. The Fed reduced interest rates by quarter point, as expected, but Powell signaled the rate cut is not the start of a trend. This marks the first rate cut by the Fed since December of 2008.
The Dow plunged 333.75 points or 1.2 percent to 26,864.27, the Nasdaq tumbled 98.19 points or 1.2 percent to 8,175.42 and the S&P 500 slumped 32.80 points or 1.1 percent to 2,980.38.
The major European markets turned in a mixed performance on Wednesday. While the U.K.'s FTSE 100 Index fell by 0.8 percent, the French CAC 40 Index inched up by 0.1 percent and the German DAX Index rose by 0.3 percent.
Crude oil prices rose on Wednesday to extend gains for a fifth straight session, with bullish inventory data and expectations surrounding a Fed rate cut helping underpin investor sentiment. WTI crude for September ended up $0.53 or about 0.9 percent at $58.58 a barrel.
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