Asian Stocks Mixed as Fed Hikes Rates to 4.00% Range

Asian share prices delivered a mixed performance on Thursday. This followed the Federal Reserve's decision to increase interest rates by a quarter of a percentage point. The move places the key rate in a new target range of 3.75% to 4.00%. This is the first hike in three years. The action aims to curb stubbornly high U.S. inflation.

U.S. stock futures pointed higher in early trading. This contrasted with the previous session's decline. The S&P 500 had dropped 0.5% on Wednesday. The Dow Jones Industrial Average fell 1.2% in the same period. The Nasdaq composite remained largely flat. Investors appear to have priced in the rate increase.

Regional indices show divergent trends

Japanese and South Korean markets posted gains on Thursday. The Nikkei 225 index rose 0.2% to 64,067.53. South Korea's Kospi index climbed 0.9% to 6,778.49. Australia's S&P/ASX 200 index added 0.3% to reach 8,718.20. India's Sensex index edged up 0.3%. Taiwan's Taiex index jumped 1.3%.

Mainland and special administrative region markets moved lower. The Hong Kong Hang Seng index fell 0.7% to 24,533.46. The Shanghai Composite index lost 0.4% to 3,877.46. These declines reflect varying regional sensitivities to U.S. monetary policy. The divergence highlights a lack of uniform reaction across the Asia-Pacific region.

Bond yields rise on inflation concerns

U.S. Treasury yields climbed following the Fed's announcement. The two-year yield jumped to 4.72% from 4.67% late Tuesday. The 10-year yield stayed near 5.00%. This level remains elevated for current market conditions. The rise reflects persistent inflationary pressures.

Oil supply constraints support prices

Brent crude traded 0.1% higher at $105.89 on Thursday. Supply remains tight due to limited flows in the Strait of Hormuz. This narrow waterway is critical for global oil transport. Saudi Arabia also closed a key pipeline for repairs. These factors add pressure to global energy supplies.