(Sharecast News) - Asia-Pacific markets traded mixed on Thursday as investors digested the US Federal Reserve's decision to hold interest rates steady and a sharp surge in gold prices to fresh record highs.
Spot gold rose more than 3% to breach $5,500 per ounce for the first time after the Fed left its benchmark rate unchanged at 3.5% to 3.75%, reinforcing demand for bullion amid resilient US growth signals.
As Patrick Munnelly, market strategy partner at TickMill, noted, "as the US dollar weakens and geopolitical tensions rise, investors are gravitating towards tangible assets for protection, driving the commodities market to new highs."
He added that gold was trading near $5,550 an ounce, marking "a staggering monthly gain of around 28%," while silver had surged by around 65% this year after more than doubling in 2025.
Overnight in the United States, the S&P 500 briefly crossed the 7,000 mark for the first time, touching an intraday high of 7,002.28 before retreating to close marginally lower, down 0.01% at 6,978.03.
The Dow Jones Industrial Average edged up 0.02% to 49,015.60, while the Nasdaq Composite outperformed, rising 0.17% to 23,857.45.
Treasury yields moved higher after the Fed upgraded its growth assessment, noting that economic activity has been "expanding at a solid pace" and that the labour market has shown signs of stabilisation.
Chair Jerome Powell said policymakers found it "hard to look at the incoming data and say the policy is significantly restrictive at this time."
Munnelly said the FOMC decision was widely anticipated, adding that while divisions remain, "the likelihood of any significant near-term policy shift seems slim," with Powell highlighting a strong consensus among the board and greater confidence in the balance of risks.
Most Asian markets manage gains in wake of Fed
Japanese equities were slightly higher, with the Nikkei 225 up 0.03% at 53,375.60 and the broader Topix gaining 0.28% to 3,545.30.
Sumitomo Metal Mining surged 9.45%, Hino Motors jumped 7.77% and Advantest rose 5.17%.
Data showed Japan's consumer confidence index rose to 37.9 in January from 37.2, its highest level since April 2024, although it remained just below expectations.
All sub-components improved, including employment outlook, income growth and willingness to buy durable goods.
Broader risk appetite was supported by what Munnelly described as equity markets showing "greater resilience amidst the turbulence," with Asian stocks inching higher despite volatility in bond and currency markets.
Chinese markets were mixed - the Shanghai Composite added 0.16% to 4,157.98, supported by sharp gains in ZheJiang JiHua Group, Ye Chiu Metal Recycling China and Guangzhou Pearl River Industrial Development, all of which climbed just over 10%.
In contrast, the Shenzhen Component slipped 0.3% to 14,300.08.
Hong Kong equities advanced, with the Hang Seng Index up 0.51% at 27,968.09, led by gains in Xinyi Glass Holdings, China Overseas and Longfor Properties.
Munnelly said investors were "exercising caution rather than rushing into risky bets," citing mixed signals from major tech earnings and growing debate over whether heavy investment in artificial intelligence would generate sufficient returns.
South Korean stocks outperformed the region, with the Kospi 100 rising 0.85% to 5,873.15.
Mirae Asset Daewoo Securities soared 17.39%, Hanmi Semiconductor climbed 11.81% and Korea Investment Holdings gained 9.38%.
Bourses in the red down under
In Australia, the S&P/ASX 200 edged down 0.07% to 8,927.50, weighed by sharp declines in Iluka Resources, which fell 14.09%, DroneShield, down 9.11%, and Viva Energy Group, which slid 8.09%.
New Zealand equities also weakened, with the S&P/NZX 50 down 0.48% at 13,348.61.
SkyCity Entertainment Group dropped 4.19%, Property for Industry fell 3.49% and Fletcher Building lost 3.35%.
Economic data in New Zealand showed the ANZ business confidence index easing in January to 64.1 from a 30-year high of 73.6, while the own-activity outlook slipped to 51.6.
Despite the pullback, confidence remained historically strong, though ANZ warned rising inflation signals could bring forward policy tightening.
Firms' pricing intentions climbed to their highest level since March 2023, with expected price increases accelerating to 2.1%, the fastest pace in two years.
Dollar weaker against antipodean peers, oil prices rise
In currency markets, the dollar was little changed against the yen at JPY 153.39, while it slipped 0.1% against the Aussie to AUD 1.4189 and fell 0.06% versus the Kiwi to change hands at NZD 1.6489.
Munnelly noted that the softer dollar had played "a significant role" in driving commodity prices higher, with the Australian dollar climbing for a ninth straight session in its longest winning streak in nearly a decade.
Oil prices were higher, with Brent crude futures last up 1.81% on ICE at $69.64 per barrel and the NYMEX quote for West Texas Intermediate rising 1.93% to $64.43, with Munnelly adding that Brent had reached its highest levels since September amid geopolitical uncertainty and supply concerns.
Reporting by Josh White for Sharecast.com.
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