Australia

Australian shares are set to rise at the open, after a strong session on Wall St saw all three major benchmarks close higher.

ASX futures were up 0.8% or 52 points as of 8:00am on Thursday, suggesting a higher open.

The Dow Jones Industrial Average rose 0.7%, or 222 points, while the tech-heavy Nasdaq Composite added 1.6%. The S&P 500 increased 1.1%, led by the information-technology and communication services sectors.

Major indexes have logged three straight monthly declines as a run-up in Treasury yields drew investors to bonds' roughly 5% returns. That dynamic flipped at least momentarily Wednesday.

Benchmark 10-year yields began slipping after the Treasury Department said that it would boost the size of long-term U.S. debt auctions in the coming months by less than Wall Street anticipated.

The agency's choice to instead lean more heavily on shorter-term debt issuance, investors said, could relieve upward pressure on longer-term yields. That, in turn, could boost stocks, which have been hurt by the rise in yields.

Treasury yields fell further later in the session, pulling 10-year yields to 4.790%, after the Fed held interest-rates steady again at 22-year highs.

In commodity markets, Brent crude oil fell 0.1% to US$84.90 a barrel while gold was flat at US$1,982.72.

In local bond markets, the yield on Australian 2 Year government bonds was higher at 4.46% while the 10 Year yield was also up at 4.94%. US Treasury notes were down, with the 2 Year yield at 4.94% and the 10 Year yield at 4.73%.

The Australian dollar hit 63.89 US cents up from the previous close of 63.36. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was down at 100.72.

Asia

Chinese shares closed mixed, as the benchmark Shanghai Composite Index ended 0.1% higher at 3023.08, the Shenzhen Composite Index was 0.1% lower and the ChiNext Price Index lost 0.5%. Baijiu stocks led gains after Kweichow Moutai raised its ex-factory product prices. Kweichow Moutai rose 5.7%, while peers Wuliangye Yibin gained 2.6% and Shanxi Xinghuacun Fen Wine Factory advanced 1.5%. Meanwhile, satellite tech stocks led losses, with Longzhou Group and QiMing Information Technology both down 10%, reaching the daily limit.

Hong Kong shares edged lower after weaker-than-expected China Caixin PMI data. The sluggish data reflected weak demand related to the housing slump and a slowdown in infrastructure spending, Maybank analyst Sonija Li said in a research note. The benchmark Hang Seng Index ended 0.1% lower at 17101.78, while the Hang Seng Tech Index declined 0.2%. Consumer services and auto stocks led losses. Trip.com fell 2.5% and Haidilao International tumbled 13% after it planned to buy a Japanese hotel company in a connected transaction. BYD shed 1.8% and Li Auto was down 0.45%. SMIC added 3% and Xinyi Solar rose 2.6%.

Japanese stocks ended broadly higher, led by companies posting strong results, as concerns eased for now about the Middle East conflict and costs of energy. Toyota Motor gained 4.7% after 2Q net profit nearly tripled on year. Mitsubishi Chemical surged 9.9% after 1H net profit beat analysts' expectations. The Nikkei Stock Average rose 2.4% to 31601.65. Investors are focusing on the U.S. central bank's rate decision later in the day. USD/JPY was at 151.28, compared with 151.66 as of Tuesday 5 p.m. Eastern Time. The 10-year Japanese government bond yield rose half a basis point to 0.955%.

Indian shares closed lower, weighed by metal and power stocks. The recent correction in the Indian stock market will likely be short-lived and Indian shares can then trade at a premium to regional peers given the country's economic growth momentum and favorable business environment, ANZ analysts Sanjay Mathur and Dhiraj Nim said in a research note. Adani Green Energy fell 3.3% and CG Power and Industrial Solutions declined 2.5%. Jindal Steel & Power was 7.8% lower and Coal India was down 2.45%. Sun Pharmaceutical Industries was the best performer, rising 2.7% after its 2Q results. India's benchmark Sensex declined 0.4% to 63591.33.

Europe

European stocks traded mixed after similarly directionless trading in Asia and as investors eye the U.S. Federal Reserve interest-rate decision later. The Stoxx Europe 600 rose 0.1%, and the DAX and CAC 40 remain broadly unchanged. Markets in Australia, South Korea and Japan rose, but stocks in mainland China and Hong Kong fell. IG futures data showed the Dow opening at 32938, versus Tuesday's close of 33052, ahead of the Fed. "Few expect another rate hike, but the event has the potential to be dollar-positive," ActivTrades analyst Ricardo Evangelista writes, adding that any comments signaling higher-for-longer rates likely would support the greenback.

The FTSE 100 fell 0.1% to 7311.75 as losses for oil giant BP, house builders and miners offset gains for retailers after Next PLC raised its guidance for the fourth time this fiscal year. Traders are cautious ahead of a Federal Reserve decision at 1800 GMT where rates should be left on hold but the door could be left open to further increases. BP fell 2% after JPMorgan downgraded the stock to underweight, while builders fall after weak U.K. Nationwide house-price data, with Taylor Wimpey down 1.5%. Next rose 3.9%, with peers Marks & Spencer and Associated British Foods up 2.3% and 1.2%, respectively. Packaging company Smurfit Kappa rose 1.8% after 3Q profit dropped but it flagged improving demand levels.

North America

Many investors on Wednesday looked to the Federal Reserve for hints about whether this autumn's unusual ascent in Treasury yields would help finish America's inflation fight. The central bank's message: maybe.

In the tug of war between low-risk government debt and higher-risk equities, that was enough of a signal to push stocks higher Wednesday. The Dow Jones Industrial Average rose 0.7%, or 222 points, while the tech-heavy Nasdaq Composite added 1.6%. The S&P 500 increased 1.1%, led by the information-technology and communication services sectors.

Major indexes have logged three straight monthly declines as a run-up in Treasury yields drew investors to bonds' roughly 5% returns. That dynamic flipped at least momentarily Wednesday.

Benchmark 10-year yields began slipping after the Treasury Department said that it would boost the size of long-term U.S. debt auctions in the coming months by less than Wall Street anticipated.

The agency's choice to instead lean more heavily on shorter-term debt issuance, investors said, could relieve upward pressure on longer-term yields. That, in turn, could boost stocks, which have been hurt by the rise in yields.

Treasury yields fell further later in the session, pulling 10-year yields to 4.790%, after the Fed held interest-rates steady again at 22-year highs.

Fed Chair Jerome Powell said at a news conference that the recent jump in bond yields is pushing up borrowing costs in ways that could ease price pressures and slow the robust U.S. economy. That could affect the central bank's monetary policy moving forward.

"Financial conditions have clearly tightened, and you can see that in the rates that consumers and households and businesses are paying now, and over time that will have an effect," Powell said. But "we just don't know how persistent it's going to be."

As Treasury yields have risen in recent months, some bond traders have increasingly tried to time the market and lock in returns at their high point. Still, others are taking Powell's warnings about additional hikes more seriously.

"Everyone is very bullish right now on rates," said James St. Aubin, chief investment officer for Sierra Mutual Funds. "But the trend is not your friend right now."

Wednesday's slip in yields opened the door for the so-called Magnificent Seven stocks to climb higher. Facebook-owner Meta and chip-maker Nvidia led the pack by advancing more than 3.5% apiece, while Amazon.com posted a 2.9% gain.

But the big winner among artificial-intelligence-aligned tech stocks was Advanced Micro Devices. Shares jumped 9.7% after executives forecast robust sales of advanced AI chips next year, putting the firm's stock on pace for its best year since 2020.

Although more firms than usual have beaten Wall Street's earnings estimates for the third quarter, many investors have instead zeroed in on projections for clues about how companies navigate an uncertain U.S. economic outlook.

Kraft Heinz vowed to not go crazy with discounts despite some inflation-weary Americans shunning higher grocery costs. The bad news for ketchup and sliced-cheese lovers left a good taste in investors' mouths: Kraft Heinz stock climbed 2.4%.

Shares in CVS fell to their lowest intraday value since November 2020 after the healthcare giant said 2024 earnings would veer toward the low end of prior guidance and investors warned of higher costs from customers on Medicare. But the stock later clawed back most of the losses and ended the session 0.4% lower.

DuPont slid 8.2% after the chemical and materials maker reported weak sales because of disappointing demand for consumer electronics and a soft Chinese market.

"This quarter, if you miss, you're getting hit hard," said Mark Heppenstall, chief investment officer at Penn Mutual Asset Management. "That hasn't always been the case since Covid."

While investors parse how an economic slowdown would affect corporate returns, oil traders are similarly weighing how tighter financial conditions could trickle down to influence fuel demand. Benchmark U.S. crude has fallen in seven of the past nine sessions, to $80.44 a barrel, weighing on shares of many oil producers.

For Heppenstall, who like other investors is trying to evaluate long-term effects of monetary policy and sometimes-conflicting signals about the U.S. economy, one factor still stands out.

"It's impossible to get beyond the math that higher interest rates mean you discount every asset," he said.