Asian stocks were mixed Thursday as China’s regulatory push sapped sentiment, overshadowing a Wall Street record on easing inflation that reduced concerns about an imminent pull back in Federal Reserve stimulus.
Equities edged up in Japan and slipped in Hong Kong and China. U.S. contracts were little changed after the S&P 500 hit an all-time high and the tech-heavy Nasdaq 100 fell amid a rotation to cyclical shares. Ten-year Treasuries pared gains spurred by a strong auction and a U.S. inflation report that lent some support to the view that price pressures are transitory.
The dollar held a drop. China released a five-year plan calling for greater business regulation as Beijing pursues a crackdown that has shaken investors. One of the latest steps is stepped up scrutiny of insurance technology platforms.
The central bank also faces calls to cut interest rates as virus outbreaks hamper the economy. Credit in China expanded last month at the slowest pace since February 2020.In the U.S., prices paid by consumers climbed at a slower pace in July but remained elevated.
The inflation trajectory has implications for the Fed’s likely timeline for tapering bond purchases and President Joe Biden’s push for unified Democrat support for another $3.5 trillion in social spending. Some lawmakers fear more outlays could push up the cost of living.
