Asian stocks waver after strong start to the week

Hong Kong, Sydney, Seoul, Taipei and Manila were up, while Shanghai, Singapore and Wellington dropped

Asian stock markets wavered Wednesday after a strong start to the week.

Asia fared marginally better, with Hong Kong, Sydney, Seoul, Taipei and Manila up, while Shanghai, Singapore and Wellington were down.

Tokyo was shut for a holiday.

There was little major reaction to data showing Chinese consumer inflation eased last month.

Traders remain on guard about developments in the tech space as they worry that the hundreds of billions firms have pumped into AI may not see any returns for some time.

Traders were also awaiting U.S. jobs data due later in the day — and inflation figures at the end of the week — that could provide a clearer idea about the central bank’s plans ahead of its March policy meeting.

The Commerce Department said Tuesday that U.S. retail sales saw no growth in December, having risen 0.6 percent in November.

The figures provided the country’s central bank with room to consider cutting borrowing costs next month, having held in January after three successive cuts.

However, they also indicated there was unease among American consumers, who are a key driver of growth, and pointed to further weakness in the economy.

And analysts said the previous “bad news is good news” adage, which has fuelled rate cut hopes in the past and propelled markets higher, might be a thing of the past.

The market is no longer responding uniformly to the idea that weaker data automatically lifts stocks, said SPI Asset Management’s Stephen Innes.

Beneath the surface, anxiety around AI-related headline risk is clearly elevated, he said.

Traders now see more chance of three rate cuts this year, with two already baked into prices, according to Bloomberg.

While the Dow edged up to another record on U.S. stock market, the S&P 500 and Nasdaq declined, with tech firms among the main losers.