Asia Stocks Set to Drop as Fed Minutes Dampen Rate Cut Hopes

Asian equities are poised for declines on Thursday following muted trading on Wall Street after the release of minutes from the Federal Reserve's January meeting.

Market Performance

* Australian and Japanese equity index futures fell.
* US stock contracts slipped in early Asian trading despite the S&P 500 reaching a new high on Wednesday.
* Treasuries advanced, with the US 10-year yield declining to 4.53%.
* The Bloomberg Dollar Spot Index rose 0.2%.
* The yen rallied against the dollar, trading around 151 per dollar.

Fed Minutes

The Fed minutes revealed that policymakers remained cautious, expressing readiness to hold interest rates steady amidst inflation and economic uncertainty. They also indicated pausing or slowing balance-sheet reduction until the debt-ceiling crisis is resolved.

Other Market Developments

* The muted performance in US stocks reflected concerns over potential further tariffs by President Donald Trump.
* Export orders for Taiwan, inflation data for Hong Kong and China, and loan prime rates for China are scheduled to be released on Thursday.
* Alibaba Group Holding Ltd. is facing a key earnings presentation after a significant rally.

Earnings Reports

* Rio Tinto Group reported a decline in annual profit.
* Fortescue Ltd. saw a 53% drop in first-half profit due to weakening Chinese demand for iron ore.

Key Events This Week

* Thursday: China loan prime rates, Eurozone consumer confidence, US jobless claims, Philadelphia Fed manufacturing index
* Friday: Eurozone manufacturing and services PMI, US S&P Global manufacturing and services PMI, existing home sales, consumer sentiment

Market Movements

Stocks

* S&P 500 futures (8:18 a.m. Tokyo time): Little change
* Hang Seng futures: -0.8%
* Australia's S&P/ASX 200: -0.7%

Currencies

* Bloomberg Dollar Spot Index: +0.2%
* Euro: Little change at $1.0425
* Japanese yen: +0.1% to 151.26 per dollar
* Offshore yuan: Little change at 7.2822 per dollar
* Australian dollar: Unchanged at $0.6344

Cryptocurrencies

* Bitcoin: +0.4% to $96,746.84
* Ether: +0.5% to $2,723.08

Bonds

* Australia's 10-year yield: -2 basis points to 4.51%

Commodities

* West Texas Intermediate crude: Little change
* Spot gold: Little change