Asia-Pacific markets were mostly lower on Tuesday after losses on Wall Street, with investors holding back ahead of the U.S. Federal Reserve’s decision on Dec. 10 stateside. The central bank is widely expected to cut rates by another 25 basis points at its final meeting of the year, bringing the Federal Funds rate to 3.5%-3.75%. However, experts said the Fed will then take a more data-dependent stance. The Nikkei 225 was up 0.21% in a volatile trading session, while the broad-based Topix was flat. Tech gains limited the Nikkei’s losses, with Disco Corp and Konica Minolta climbing 5.42% and 4.91% respectively. South Korea’s Kospi slipped 0.63%, but the small-cap Kosdaq was 0.15% higher. Australia’s S&P/ASX 200 declined 0.24%. Hong Kong Hang Seng index fell 0.75%, while mainland China’s CSI 300 index was down 0.19%.
The S&P 500 pulled back on Monday as investors awaited the Federal Reserve’s last meeting of the year later this week. The broad market index fell 0.35% to close at 6,846.51, while the Nasdaq Composite slid 0.14% to settle at 23,545.90. The Dow Jones Industrial Average shed 215.67 points, or 0.45%, to finish at 47,739.32. Weighing on stock sentiment was the 10-year Treasury yield continuing its recent run higher. The benchmark has moved up this month despite the likelihood that the Fed is going to cut this week as investors worried about the state of inflation in the new year and whether the central bank will be able to continue easing. Traders have grown increasingly hopeful over recent weeks that the Fed will lower interest rates once again after it issued a quarter percentage point cut at its meetings in September and October.
Gold prices hovered around $4,190 per ounce on Tuesday as investors awaited the Federal Reserve’s policy meeting. With the Fed widely expected to deliver a 25-bps rate cut, traders will be closely watching the updated economic projections and remarks from Chair Jerome Powell for hints on the central bank’s plans for 2026 and beyond. Current market pricing implies an 87% probability of a such a move, with expectations now pointing to two more reductions next year, down from three anticipated just a week ago. Before the Fed's decision, market participants will assess the JOLTS job openings data later today. Elsewhere, China’s central bank raised its gold holdings for the 13th straight month, bringing total reserves to 74.12 million troy ounces.
WTI crude oil futures traded below $59 per barrel on Tuesday after sliding 2% in the previous session, as expectations of a supply glut outweighed geopolitical risks. Investors are now awaiting reports from the IEA and OPEC+, due later this week, for updated supply-demand guidance. In mid-October, the IEA projected a sizeable surplus for 2026, while OPEC+ last month revised its Q3 outlook from a deficit to a surplus. Adding further pressure, reports on Monday indicated that Iraq has restored production at Lukoil’s West Qurna-2 oilfield, which represents 0.5% of global supply, following a temporary shutdown caused by an export-pipeline leak.
President Donald Trump on Monday threatened to impose an additional 5% tariff on Mexico if it doesn’t immediately provide additional water to help U.S. farmers, accusing the country of violating a treaty that outlines water sharing between the neighbours. Under the treaty, Mexico must send 1.75 million acre-feet of water to the U.S. from the Rio Grande through a network of interconnected dams and reservoirs every five years. Trump said in a social media post that Mexico “owes” the U.S. 800,000 acre-feet of water due to violations of the treaty over the past five years. He demanded Mexico release 200,000 acre-feet of water before December 31, and more “soon after.” The lack of water was hurting crops and livestock in Texas, Trump said.
President Donald Trump announced Monday that his administration is doling out a $12 billion aid package to farmers who have been squeezed by a trade war between the U.S. and its top economic partners. The funds will come from U.S. tariff revenues, Trump said during a roundtable event at the White House. Most of that money — up to $11 billion — will go to the U.S. Agriculture Department’s new Farmer Bridge Assistance program, which will provide one-time payments to row crop farmers, a White House official told CNBC earlier Monday. The remaining $1 billion will be reserved as the USDA evaluates changing market conditions, according to the official. The president was joined at the event by Treasury Secretary Scott Bessent and Agriculture Secretary Brooke Rollins, as well as members of Congress and farmers who raise cattle and grow corn, cotton, sorghum, soybean, rice, wheat and potatoes.
Tensions are mounting once again between U.S. President Donald Trump and President Volodymyr Zelenskyy after the White House leader accused Ukraine’s head of state of not even reading the U.S.′ peace proposals yet. “I’m a little bit disappointed that President Zelenskyy hasn’t yet read the proposal, that was as of a few hours ago,” Trump told reporters on Sunday night. “His people love it, but he hasn’t [read it],” Trump added. “Russia, I guess, would rather have the whole country when you think of it, but Russia is, I believe, fine with it, but I’m not sure that Zelenskyy is fine with it,” Trump said. It’s uncertain which version of the U.S.-backed peace plan for Ukraine Trump was referring to but the president’s comments came a day after talks between U.S. and Ukrainian officials ended in Miami without an apparent agreement over the latest version of a draft peace plan.
Japanese authorities lifted tsunami warnings on Tuesday hours after a powerful 7.5-magnitude earthquake shook northeastern regions, injuring at least 30 people and forcing about 90,000 residents to evacuate their homes. The earthquake struck off the coast at 11:15 p.m. (1415 GMT) on Monday, and the Japan Meteorological Agency said a tsunami as high as 3 metres (10 feet) could hit the country’s northeastern coast. Warnings were issued for the prefectures of Hokkaido, Aomori and Iwate, and tsunamis from 20 to 70 cm (7 to 27 inches) high were observed at several ports, JMA said. By the early hours of Tuesday, the JMA downgraded the warnings to advisories, and later lifted all advisories. There were no reports of major damage.
Tata Electronics has lined up American chip designer Intel as a prospective customer as the division of Mumbai-based conglomerate Tata Group works to expand India’s domestic electronics and semiconductor supply chain. Under a Memorandum of Understanding, the companies will explore the manufacturing and packaging of Intel products for local markets at Tata Electronics’ upcoming plants. Intel and Tata also plan to assess ways to rapidly scale tailored artificial intelligence PC solutions for consumers and businesses in India. In a press release on Monday, Tata said that the collaboration marks a pivotal step towards developing a resilient, India-based electronics and semiconductor supply chain.
Paramount Skydance on Monday launched a hostile bid worth $108.4 billion for Warner Bros Discovery, in a last-ditch effort to outbid Netflix and create a media powerhouse that would challenge the dominance of the streaming giant. Netflix had emerged victorious on Friday from a weeks-long bidding war with Paramount and Comcast, securing a $72 billion equity deal for Warner Bros Discovery’s TV, film studios and streaming assets. But Paramount’s latest attempt means the jockeying for Warner Bros and its prized HBO and DC Comics assets will not come to a conclusion swiftly. The Warner Bros Discovery board of directors on Monday afternoon said it would review Paramount’s offer, but was not modifying its recommendation with respect to Netflix. It advised the company to "take no action at this time" in regard to the Paramount Skydance proposal.
President Donald Trump on Monday said Nvidia will be allowed to ship its H200 artificial intelligence chips to “approved customers” in China and elsewhere, on the condition that the U.S. gets a 25% cut. Chinese President Xi Jinping “responded positively” to the proposal, Trump wrote in a Truth Social post. The policy “will support American Jobs, strengthen U.S. Manufacturing, and benefit American Taxpayers,” Trump wrote. “The Department of Commerce is finalizing the details, and the same approach will apply to AMD, Intel, and other GREAT American Companies,” he added in the post. Both Nvidia and chip rival AMD, short for Advanced Micro Devices, agreed in August to share 15% of the revenue from China chip sales with the U.S. government. But around that same time, China reportedly warned companies against using the H20 AI chip that Nvidia designed especially for the country.
Shares of Interglobe Aviation, operator of India’s largest airline Indigo, fell more than 8% Monday as the carrier grapples with multiple flight cancellations. Indigo, which operates more than 2,300 flights daily, could only fly 706 flights on Friday following a change in rules about pilots’ rest time for pilots, leading to massive disruptions. On Sunday, the company said in a release that it operated 1,650 flights and it expects “stabilization of the network” by Wednesday. India’s civil aviation minister Ram Mohan Naidu said on Monday that the government has ordered an investigation into the disruptions of Indigo’s flight services. “We will take strict action,” the minister said, warning the airline of consequences for “non-compliance.” On Friday, after disruptions due to flight cancellations by Indigo peaked, the government temporarily suspended its implementation of Flight Duty Time Limitations rules.