Asian shares are mixed ahead of interest rate decision by the Fed
[December 08, 2025] By
ELAINE KURTENBACH
BANGKOK (AP) — Shares were mixed in Europe and Asia as investors were
treading cautiously Monday ahead of an interest rate decision this week
by the Federal Reserve.
Germany's DAX was unchanged at 24,025.15, while the CAC 40 in Paris lost
0.3% to 8,090.47. Britain's FTSE 100 shed edged 0.1% higher, to
9,675.51.
The future for the S&P 500 edged up 0.1% while that for the Dow Jones
Industrial Average was little changed.
In Asia, flaring Japan-China tensions weighed on sentiment after Chinese
military aircraft locked radar on Japanese fighter jets during the
weekend. The episode occurred weeks into a downturn in relations after a
remark about defense of Taiwan by Japanese Prime Minister Sanae Takaichi
angered Beijing.
Defense Minister Shinjiro Koizumi said Japan had formally protested the
incident, calling it “an extremely regrettable” act and “a dangerous”
one that “exceeded the scope necessary for safe aircraft operations.”
Tokyo's Nikkei 225 index slipped 0.2% to 50,581.94 after the government
reported revised government data showing that Japan’s economy contracted
at an annual pace of 2.3% in the July-September period, not the 1.8%
annual rate earlier reported. Japanese exports suffered from the impact
of U.S. President Donald Trump’s tariffs and public investments slipped.
Chinese markets were mixed, with Hong Kong's Hang Seng falling 1.2% to
25,765.36, while the Shanghai Composite index gained 0.5% to 3,924.08.
China reported its trade surplus has exceeded $1 trillion so far in
2025, as exports climbed 5.9% in November from a year earlier. Exports
to the U.S. sank 29% year-on-year, while shipments to other destinations
helped offset that decline.
Chinese leaders convened a major annual economic policy planning
conference to sketch out details for the coming year and beyond.
Elsewhere in Asia, South Korea's Kospi added 1.3% to 4,154.85, while
Taiwan's benchmark jumped 1.2%.
In Australia, the S&P/ASX 200 shed 0.1% to 8,624.40.
On Friday, the S&P 500 added 0.2% and finished just shy of its record
closing level set in October after briefly topping that level during the
day.
The Dow industrials added 0.2% and the Nasdaq composite gained 0.3%.
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A currency trader watches monitors near a screen showing the Korea
Composite Stock Price Index (KOSPI) at the foreign exchange dealing
room of the Hana Bank headquarters in Seoul, South Korea, Monday,
Dec. 8, 2025. (AP Photo/Ahn Young-joon)
 The modest moves capped a quiet week
for Wall Street, offering a respite following weeks of sharp and
scary swings.
This week, attention will focus on what the Federal Reserve will do
with interest rates, whether too many dollars are flowing into
artificial-intelligence technology and if sharp drops for
cryptocurrencies would bleed over into other markets.
After some back and forth, the widespread expectation among traders
is now that the Fed will cut its main interest rate Wednesday in
hopes of shoring up the slowing U.S. job market. If it does, that
would be the third cut of the year.
Lower interest rates boost prices for investments and help the
economy. The downside is that they can worsen inflation, which is
stubbornly remaining above the Fed’s 2% target.
Economic reports released on Friday did little to change
expectations for a coming cut. One said that an underlying measure
of inflation that the Fed prefers to use was at 2.8% in September,
exactly as economists expected.
A separate report said U.S. consumers appear to be downgrading their
expectations for inflation coming in the near future. They’re now
forecasting 4.1% inflation for the year ahead, down from their
forecast of 4.5% last month, according to the University of
Michigan.
That’s the lowest such forecast since January, which is important
because heightened expectations for inflation can create a vicious
cycle that only worsens inflation.
In other dealings early Monday, U.S. benchmark crude oil added 8
cents to $60.16 per barrel. Brent crude, the international standard,
was nearly unchanged at $63.77 per barrel.
The dollar rose to 155.44 Japanese yen from 155.30 yen late Friday.
The euro rose to $1.1650 from $1.1639.
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