In HONG KONG, markets in Asia showed a mix of results on Tuesday. This came after Wall Street experienced a shaky start but managed to end on a positive note the day before, marking the beginning of a week shortened by holidays.
U.S. futures were little changed and oil prices rose.
Honda’s shares saw a significant increase of over 16% following the announcement by the Japanese automotive giant regarding a share buyback of up to 1.1 trillion yen ($7 billion). Additionally, discussions about a potential merger between Honda and Nissan were also on the table.
On Monday, the two companies disclosed that they had entered into a memorandum of understanding. Furthermore, Nissan’s ally, Mitsubishi Motors Corp., agreed to participate in discussions aimed at integrating their operations. However, Nissan’s shares experienced a slight decrease of 0.1% on Tuesday.
Japan’s benchmark Nikkei 225 slipped 0.3% in morning trading to 39,055.35.
South Korea’s consumer sentiment sharply dropped in December amid rising concerns over political uncertainty following the parliament’s impeachment of President Yoon Suk Yeol. The decline hit the lowest level since November 2022, when a Halloween crowd crush resulted in 159 fatalities.
South Korea’s Kospi lost 0.3% to 2,436.67.
The Hang Seng in Hong Kong added 1.2% to 20,119.47 and the Shanghai Composite index was up 0.7% at 3,374.58. Australia’s S&P/ASX 200 advanced 0.3% to 8,225.00.
Taiwan’s Taiex gained 0.5%, with Taiwan Semiconductor Manufacturing Co. shares reaching a record high during the early trading day.
On Monday, the S&P 500 ended 0.7% higher to 5,974.07 after having been down 0.5% in the early going. The Dow Jones Industrial Average also recovered from an early slide to eke out a 0.2% gain to 42,906.95. The tech-heavy Nasdaq composite rose 1% to 19,764.89.
Traders got a look at a new snapshot of U.S. consumer confidence Monday. The Conference Board said that consumer confidence slipped in December. Its consumer confidence index fell back to 104.7 from 112.8 in November. Wall Street was expecting a reading of 113.8.
The unexpectedly weak consumer confidence update followed several generally strong economic reports last week. One report showed the overall economy grew at a 3.1% annualized rate during the summer, faster than what was thought earlier. The latest report on unemployment benefit applications showed that the job market remains solid.
A report on Friday said that a measure of inflation the Federal Reserve likes to use was slightly lower last month than economists had expected. Worries about inflation edging higher again had been weighing on Wall Street and the Fed.
The central bank just delivered its third cut to interest rates this year, but inflation has been hovering stubbornly above its target of 2%. It has signaled that it could deliver fewer cuts to interest rates next year than it earlier anticipated because of concerns over inflation.
Expectations for more interest rate cuts have helped drive a roughly 25% gain for the S&P 500 in 2024. That drive included 57 all-time highs this year.
Inflation concerns have added to uncertainties heading into 2025, which include the labor market’s path ahead and shifting economic policies under an incoming President Donald Trump.
“Put simply, much of the strong market performance prior to last week was driven by expectations that a best-case scenario was the base case for 2025,” said Brent Schutte, chief investment officer at Northwestern Mutual Wealth Management Company
Treasury yields rose in the bond market. The yield on the 10-year Treasury rose to 4.59% from 4.53% late Friday.
Wall Street has several other economic reports to look forward to this week. The United States will release its November report for sales of newly constructed homes later in the day. A weekly update on unemployment benefits is expected on Thursday.
Markets in the U.S. will close at 1 p.m. Eastern on Tuesday for Christmas Eve and will remain closed on Wednesday for Christmas.
In other dealings, U.S. benchmark crude oil picked up 23 cents to $69.47 per barrel. Brent crude, the international standard, was up 26 cents at $72.58.
The dollar traded at 157.07 yen by early Tuesday, down from 157.14 yen. The euro fell to $1.0397 from $1.0408.
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