Regional sentiment weakens in lockstep with Wall Street ahead of the U.S. central bank’s final policy decision of 2025
MARKET INSIDER – Asia-Pacific markets slipped on Tuesday, echoing Wall Street’s cautious pullback as global investors await the Federal Reserve’s December 10 interest rate decision, a moment that could set the tone for early 2026.
The Fed is widely expected to deliver another 25 bps rate cut, taking the federal funds rate to 3.5%–3.75%, but analysts warn Chair Jerome Powell is likely to strike a more data-dependent tone afterward. With signs of softening in the labor market, Powell may signal a pause without sounding overtly hawkish.
Market reaction across the region reflected this wait-and-see posture. Japan’s Nikkei 225 reversed early gains to close slightly lower, while the Topix also dipped. South Korea’s Kospi fell even as its tech-heavy Kosdaq managed modest gains. Australia’s ASX 200 edged down, and Hong Kong’s Hang Seng index was flat-to-lower, mirroring a 0.25% decline in China’s CSI 300.
U.S. futures ticked higher after markets closed Monday, helped by President Donald Trump’s approval of Nvidia’s H200 chip sales to China — a tightly controlled arrangement that directs 25% of the revenue from those shipments to the U.S. government. Nvidia jumped 2.2% in after-hours trading.
Still, Wall Street ended Monday in the red, with the S&P 500 down 0.35%, the Nasdaq off 0.14%, and the Dow losing 0.45%.
With a major Fed pivot potentially on deck, global markets remain on edge — waiting for clarity on whether Wednesday’s cut will be the final move before the central bank steps back to assess the economic landscape.
