Equities increase as Fed reduces concerns about hike

Thursday saw gains in Asian equities and U.S. futures as the Federal Reserve reduced the likelihood of an interest rate rise, but the yen remained choppy following yet another round of alleged Japanese intervention.

The yen strengthened vs the dollar shortly after Fed Chair Jerome Powell concluded his remarks to reporters, hinting that the Fed could need to keep interest rates high.

Since it was the second sharp increase in the weak Japanese yen this week, investors believe the government was acting as a yen buyer.

Powell told reporters that there was too much inflation and that there was no guarantee that it would decline. The Fed has decided to keep interest rates on hold. However, he dismissed mounting concerns that the Fed could have to raise interest rates.

"There are ways to cut and ways to refrain from cutting. His statement, "It's really going to depend on the data," was seen by traders as essentially ruling out a rate increase.

As the Fed said it would delay its balance-sheet runoff, Treasury bonds gained strength and rates decreased.

Earlier this year, markets priced in up to six rate cuts for 2024; by December, they are only pricing in one.

All eyes were on the yen in the foreign currency market as it gave up most of its gains during the Asia session following a surge in late New York trading. Since Japan's interest rates have remained extremely low while those across the world have dramatically increased, the yen has been in a downward trend.

The chipmaker Qualcomm's shares increased 4% in after-hours trading after its earnings topped market estimates for sales and profit.

Later today, markets will be watching Apple's earnings to see if the firm plans to include artificial intelligence (AI) into iPhones, since they had anticipated a significant decline in sales.

(Sources: investing.com, reuters.com)