Asia-Pacific Markets React to U.S. Economic Signals and China’s GDP Forecasts

Asia-Pacific markets displayed mixed results on Tuesday, influenced by recent political and economic developments from the United States. Federal Reserve Chair Jerome Powell indicated that the central bank would not delay interest rate cuts until inflation reaches the 2% target, emphasizing the lagging effects of monetary policy. This statement has raised concerns among investors about the timing of future rate adjustments. In mainland China, the CSI 300 index rose by 0.63%, closing at 3,498.28. However, the Hang Seng index faced pressure, particularly from insurance giant Ping An, whose shares plummeted over 5% following the announcement of a cancellation of $102.6 million in A shares from its repurchased securities account. Meanwhile, Australia’s S&P/ASX 200 index dipped 0.23%, retreating from its recent all-time high, finishing at 7,999.3. The economic outlook for China has dimmed, with Goldman Sachs revising its full-year GDP growth forecast down to 4.9% from 5%, and JPMorgan lowering its estimate from 5.2% to 4.7%. Analysts stress the necessity for increased government policy support in the latter half of the year to achieve around 5% growth, citing weak domestic demand as a significant concern. Investors are closely monitoring the upcoming Third Plenary Session, which will address high local government debt and advancements in manufacturing. In the U.S., major indices saw gains, with the Dow Jones Industrial Average rising 0.53% to a record 40,211.72, the S&P 500 increasing by 0.28% to 5,631.22, and the Nasdaq Composite climbing 0.4% to close at 18,472.57.