Hong Kong, Jan 9, (V7N) – Asian markets faced headwinds on Thursday following a mixed performance on Wall Street, as concerns over inflation, US interest rates, and the policy direction under Donald Trump's second presidency dampened investor sentiment.

Adding to the uncertainty, reports suggest President-elect Trump is considering a national economic emergency to justify imposing tariffs on all imports. Meanwhile, persistently low inflation in China despite government stimulus measures weighed further on regional markets.

The Federal Reserve’s hawkish stance last month, with fewer anticipated rate cuts in 2025 due to sticky inflation and a robust labor market, has fueled fears of prolonged high borrowing costs. The situation is compounded by market jitters over Trump’s plans to slash taxes, tighten immigration, and escalate trade tariffs, which could reignite price pressures.

Chinese data showing subdued inflation in December prompted calls for more aggressive fiscal and monetary policy to revive the world’s second-largest economy. Economists expect stronger support measures from Beijing in 2025 to combat domestic pessimism and mitigate external risks like potential US tariffs and sanctions under Trump’s administration.

Early trade saw Hong Kong inch up while Shanghai dipped, reflecting mixed sentiment. Tokyo, Sydney, and several other markets in the region fell, though Seoul and Jakarta posted gains. On currency markets, the dollar maintained its strength, with the pound and euro hovering near multi-month lows.

Key Market Figures (as of 0230 GMT)

Tokyo - Nikkei 225: Down 0.8% at 39,678.93

Hong Kong - Hang Seng Index: Up 0.3% at 19,339.31

Shanghai - Composite: Down 0.4% at 3,216.11

Euro/Dollar: Up at $1.0318

Pound/Dollar: Up at $1.2362

Dollar/Yen: Down at 158.06 yen

WTI Crude: Down 0.5% at $72.99 per barrel

Brent Crude: Down 0.4% at $75.86 per barrel

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