(Bloomberg) -- Asian stocks are poised for a weak start Thursday on the back of declines in the US after Federal Reserve Chair Jerome Powell threw cold water on expectations of rate cuts anytime soon.

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US futures extended losses in early Asia trading after the S&P 500 closed near session lows. Contracts for Australia dropped, while those for Hong Kong rose. US-listed shares of Chinese companies slipped in a sign of souring risk sentiment. Japanese markets are shut for a holiday.

Australian bonds rose following gains in US Treasuries. The yen, which outperformed Group-of-10 peers on Wednesday against a broadly weaker dollar, added to gains as trading resumed in Asia. Oil extended its slump as weak demand data from the US added to concern the global economy is heading toward a recession.

In what may set the stage for more volatility, the $370 billion exchange-traded fund tracking the US equity benchmark (SPY) whipsawed in late trading as concerns over the stability of the financial system resurfaced. PacWest Bancorp plunged 60% in postmarket trading, leading regional banks lower, after people familiar said the Beverly Hills-based lender has been weighing a range of strategic options, including a sale.

In a typical choppy Fed day of trading, US equities rallied after the Fed raised rates by a quarter-point as economists forecast and hinted at a possible pause in the most aggressive hiking cycle since the 1980s. However, equities turned lower later as Powell said there won’t be any rate cuts if the inflation rate remains too high. Treasuries rose and the dollar fell.

“Potential Fed pause, but no Fed pivot yet,” said Jason Pride at Glenmede. “The Fed is telegraphing that additional monetary tightening may or may not occur, but rate cuts do not yet appear to be on the table. The Fed’s leadership is working hard to thread the needle between telegraphing too much tightening while also not agreeing with the market’s rate cut narrative.”

Read More: Wall Street Greets ‘End of the Hiking Cycle’ With More Questions

The rate debate will resume again later Thursday, with the European Central Bank taking center stage. Policymakers are seen raising the deposit rate by a quarter-point to a 3.25%, which would mark a slowdown in their hiking cycle. The decision is expected at 2:15 p.m. in Frankfurt, followed half an hour later by President Christine Lagarde speaking at a press conference.

Key events this week:

• US initial jobless claims, trade balance, Thursday

• European Central Bank rate decision, followed by ECB President Christine Lagarde’s news conference, Thursday

• US unemployment, nonfarm payrolls, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures fell 0.4% as of 8:17 a.m. Tokyo time. The S&P 500 fell 0.7%

• Nasdaq 100 futures fell 0.1%. The Nasdaq 100 fell 0.6%

• Australia’s S&P/ASX 200 futures fell 0.5%

• Hang Seng Index futures rose 0.3%

Currencies

• The Bloomberg Dollar Spot Index was little changed

• The euro was little changed at $1.1068

• The yen rose 0.1% to 134.56 per dollar

• The offshore yuan was little changed at 6.9205 per dollar

Cryptocurrencies

• Bitcoin rose 2% to $29,096.74

• Ether rose 1.8% to $1,907.68

Bonds

• The yield on 10-year Treasuries declined nine basis points to 3.34%

• Australia’s 10-year yield declined nine basis points to 3.32%

Commodities

• West Texas Intermediate crude fell 1.9% to $67.32 a barrel

• Spot gold rose 0.6% to $2,051.51 an ounce

This story was produced with the assistance of Bloomberg Automation.

--With assistance from Richard Henderson and Rita Nazareth.

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