Asian stock are mixed ahead of the Fed’s rate hike decision

• Asian stock markets are unsettled ahead of the Federal Reserve’s decision on how aggressively it will hike interest rates to curb inflation in the United States.
• The Dow Jones Industrial Average dropped 0.5 percent to 30,364.83, while the Nasdaq Composite gained 0.2 percent to 10,828.35.

BEIJING– Asian stock markets were neutral on Wednesday, ahead of the Federal Reserve’s decision of how severely it will hike interest rates to curb inflation in the United States.

Shanghai and Hong Kong made strides. Tokyo and Sydney have both declined. Oil prices rose somewhat.

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The S&P 500 index fell 0.4 percent on Tuesday as traders awaited a Fed rate hike expected to be three-quarters of a percentage point, or quadruple the normal range. They are concerned that vigorous Fed measures to temper inflation, which is at a four-decade high, may tip the world’s largest economy into recession.

A “hawkish surprise” from the Fed might be a “further shock to risk assets,” according to ActivTrades’ Anderson Alves in a report. “Money markets are already pricing around 90% possibility of such action.”

The Shanghai Composite Index rose 1.1 percent to 3,323.64 after the Chinese government reported that factory output in May rebounded into positive territory as anti-virus regulations that shut down enterprises in Shanghai and other industrial regions eased.

The Hang Seng in Hong Kong rose 1.2 percent to 21,312.67, while the Nikkei 225 in Tokyo fell 0.7 percent to 26,435.01.

The Seoul Kospi fell 1.2 percent to 2,463.45 after the government revealed that South Korea’s jobless rate rose 0.1 percent to 2.8 percent in May.

The S&P-ASX 200 in Sydney fell 0.4 percent to 6,658.40. Singapore and New Zealand advanced, while Jakarta fell.

On Wall Street, the S&P 500 fell to 3,735.48, 21.8 percent below its top on January 3. That puts it in a bear market, or a 20% decrease from the previous market high.

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The Dow Jones Industrial Average dropped 0.5 percent to 30,364.83, while the Nasdaq Composite gained 0.2 percent to 10,828.35.

Expectations of an exceptionally large Fed rate hike rose Friday after government data showed consumer inflation jumped in May rather than dropping as expected.