Asian stocks set to edge lower ahead of US Fed chair’s policy speech
Published Fri, Aug 28, 2026 · 08:09 AM
ASIAN STOCKS were set to open mildly lower on Friday (Aug 28) as investors braced for US Federal Reserve chair Kevin Warsh’s speech in Jackson Hole, where some expect a hawkish tone.
Equity-index futures for South Korea and Hong Kong pointed to initial declines, while those for Japan were flat. US stock contracts edged down after tech shares rallied on Wall Street, as Nvidia’s bullish outlook boosted optimism in the artificial intelligence trade. Nvidia surged almost 9 per cent, the most since April 2025.
Treasuries fell for a second day on Thursday ahead of Warsh’s remarks, with yields rising two to three basis points across the curve. US crude oil climbed on signs that diplomatic efforts toward an agreement over the Strait of Hormuz have hit fresh hurdles.
Warsh’s speech will be key in determining whether the recent rise in bond yields has further to run, with investors looking for clues on how the US Fed will balance persistent inflation pressures against signs of a cooling US economy. A lack of clarity on the policy path may add to volatility in longer-maturity Treasuries and spill over into stocks.
“If he does not give any framework guidance, the risk is that it will involve a much higher move in long rates,” Torsten Slok, chief economist at Apollo Global Management, said in an interview with Bloomberg Television.
Traders also assessed fresh clues on the US Fed’s policy path, including a drop in US jobless claims and rising wholesale inventories, while the merchandise trade deficit widened in July to the largest since early 2025. Kansas City Fed President Jeff Schmid said monetary policy is not restraining the economy.
US Fed policymakers left the federal funds rate unchanged at 3.5 to 3.75 per cent at their latest meeting, while futures are pricing in a quarter-point increase by year-end.
“Clear policy signal will likely be scarce given Warsh’s reluctance to provide forward guidance,” said Elias Haddad at Brown Brothers Harriman & Co. “Instead, Warsh may preview the Fed five task forces’ early findings on communications, the balance sheet, economic data, productivity and jobs, and the inflation frameworks.”
US technology stocks rallied on Thursday on Nvidia’s blockbuster outlook, lifting the major indexes even as every other sector in the US market declined.
While questions over the sustainability of AI spending may continue to fuel bouts of volatility in tech, accelerating investment in the sector may also add to inflation and upward pressure on bond yields.
“As is usually the case when tech ramps, the group is sucking oxygen from the rest of the market,” Vital Knowledge founder Adam Crisafulli wrote in a note. The “accelerating AI boom is creating upside risk for yields,” he said. BLOOMBERG
