Asian Markets Mostly Declined on Concerns over the US and Japanese Interest Rates Outlooks

 

Asian markets largely ended the week on a falling note on Friday (Jan. 10). Investors grew cautious over the outlook for fewer US interest rate cuts and potential rate hikes by the Bank of Japan (BOJ). China's declining inflation data and heightened trade tensions with the US cooled the sentiment.

 

Japan's Nikkei 225 index slid 1.05%. The decline followed stronger-than-expected wage and household spending data for November, fueling speculation of a possible BOJ interest rate hike as early as January. A tighter monetary policy outlook strengthened the yen, depressing export-driven stocks that are important components of Japan's market.

 

China's indexes fell, with the Shanghai Composite index slipping 1.33% and Hong Kong's Hang Seng index dipping 0.92%. The loss in the Hong Kong market followed its major constituent Tencent Holdings' (HK: 0700) addition to a US investment blacklist. The move raised concerns over intensifying U.S.-China tensions in 2025. China’s falling inflation data reported this week further weighed on sentiment, though it also gave hopes for potential economic stimulus measures.

 

India’s Nifty 50 index opened flatly as the market awaited major corporate earnings reports. However, the index has experienced continuous losses recently due to fading confidence in India's economic performance. As of 4:42 pm. SGT., Nifty 50 index fell 0.31%.

 

Broader Asian markets mirrored the downward trend. South Korea’s KOSPI closed down 0.24% amid ongoing political unrest. As of 4:26 pm. SGT., Singapore’s Straits Times index slid 1.60%. FTSE Malaysia KLCI index rose 0.31%.