"Asian Stocks Retreat Amid Fed Rate Speculation and Wall Street's Shaky Start to 2024"

Asian stocks declined as traders scaled back expectations for early and significant U.S. Federal Reserve rate cuts, following the release of the Fed's December meeting minutes which suggested a cautious approach to monetary policy. The minutes indicated concerns about overly restrictive policy impacting the economy and a lack of clear signals on when rate cuts might commence. This led to a decrease in the probability of a March rate cut from 90% to 70%, as per the CME FedWatch tool. Investors are now anticipating less easing this year, with futures pricing in under 150 basis points of cuts compared to 160 bps previously expected. Meanwhile, U.S. nonfarm payrolls data is awaited for further labor market insights, and China's service sector showed expansion, contrasting with official data indicating a contraction.