Asian stock markets saw narrow trading ranges on Friday, concluding a strong week for global equities with a consolidation phase. The market activity was subdued due to the Thanksgiving holiday in the United States, which shuttered Wall Street on Thursday and resulted in a shortened trading session on Friday. This holiday silence led to lighter volumes across major asset classes worldwide.

The week’s positive momentum was largely driven by growing expectations that the U.S. Federal Reserve is poised to continue cutting its benchmark interest rate in the upcoming months.

Regional Market Performance

In Asia, market movements were mixed:

• Indices such as South Korea’s Kospi, Japan’s Nikkei 225, and Hong Kong’s Hang Seng traded marginally lower.
• Conversely, China’s Shanghai Composite managed to move into positive territory.
• The broad MSCI Asia-Pacific shares index (excluding Japan) held flat, yet it remained on course for an approximate 3% weekly gain, marking its first weekly increase in a month.

Focus on US Monetary Policy

Investor focus remains firmly fixed on the trajectory of the Federal Reserve’s policy path. Recent statements from senior Fed officials indicate support for a potential third consecutive rate cut, suggesting that rising concerns about a weakening labor market are taking precedence over risks associated with inflation.

Current market pricing reflects a high probability (around 85%) of a rate cut occurring in December, with expectations for several more cuts in 2026.

Traders are now awaiting crucial upcoming U.S. economic data releases, including reports on private sector hiring, services activity, and the Fed’s preferred measure of inflation—the Personal Consumption Expenditure (PCE) index—which will heavily influence the December policy decision.

Currency and Commodities

In currency markets, the Japanese yen experienced slight fluctuations against the dollar after Tokyo inflation data came in hotter than anticipated. This unexpected result briefly revived speculation about the Bank of Japan (BoJ) potentially shifting toward a future rate hike. Despite this bounce, the yen continues to face pressure stemming from concerns over Japan’s fiscal outlook.

In the commodities sector, the global oil benchmark, Brent crude, saw a modest increase, rising by 0.36%.