HONG KONG – Asian markets retreated and the dollar wobbled Thursday after the Fed kept its key lending rate on hold as expected at its latest policy meeting.
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KEEPING SCORE: Japan's benchmark Nikkei 225 index slipped 1.2 percent to 18,914.58 as the stronger yen weighed on exporters, while South Korea's Kospi dipped 0.5 percent to 2,070.64. Hong Kong's Hang Seng lost 0.7 percent to 23,160.60 and Australia's S&P/ASX 200 edged 0.1 percent lower to 5,645.40. Markets in mainland China were closed for the final day of a weeklong holiday. Southeast Asian indexes were mostly lower.
CENTRAL BANKING: The Federal Reserve left a key interest rate on hold after its latest policy meeting, as investors had expected. Policymakers signaled that they still expect to gradually raise rates but gave no clear timeline. Markets are keeping an eye on the outcome of the Bank of England's policy meeting expected later in the day, though no change is expected.
EARNINGS SEASON: Investors are assessing the latest corporate earnings reports. Highlights include Facebook, which said fourth-quarter earnings more than doubled to nearly $3.6 billion, blowing past Wall Street forecasts. Sony was due to release its latest results after trading closes in Tokyo.
U.S. DATA: Factory activity expanded at the fastest rate in more than two years in January, according to a monthly survey by the Institute for Supply Management. Meanwhile, employment strengthened at U.S. companies for the same month, according to a survey by ADP. The reports add further evidence that the world's biggest economy continues to improve but investors may be growing wary of risky investments in light of U.S. President Donald Trump's unexpected policy announcements since taking office.
MARKET VIEW: "Donald Trump's presidency comes with greater than normal risks," Shane Oliver, head of investment strategy at AMP Capital Investors in Sydney, said in a report. Eventually, "pragmatic pro-growth policies are likely to ultimately dominate populist policies. However, the Trump honeymoon with investors is likely over with a short term period of correction/volatility likely to continue in shares, bond yields and the U.S. dollar."
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WALL STREET: Major U.S. benchmarks were little changed. The Dow Jones industrial average rose 0.1 percent to close at 19,890.94. The Standard & Poor's 500 eked out a tiny gain to end at 2,279.55. The Nasdaq composite added 0.5 percent to 5,642.65.
CURRENCIES: The dollar eased to 112.59 yen from 112.98 yen in late trading Wednesday. The euro crept up to $1.0794 from $1.0778.
ENERGY: U.S. crude oil futures slipped 24 cents to $53.64 a barrel in electronic trading on the New York Mercantile Exchange. The contract added $1.07, or 2 percent, to close at $53.88 a barrel on Wednesday. Brent crude, the benchmark for international oil prices, lost 19 cents to $56.61 a barrel in London.