Asia-Pacific markets trade higher as Fed signals smaller hikes ahead

Soegeefx AppsAsia MarketAsia-Pacific markets trade higher as Fed signals smaller hikes ahead

Jihye Lee

Markets in the Asia-Pacific traded higher, carrying on the optimism behind Wall Street’s rally as Federal Reserve Chair Jerome Powell confirmed smaller rate hikes could start in December.

Hong Kong’s Hang Seng index rose 1.67%, with the Hang Seng Tech index trading 2.58% higher. In mainland China, the Shanghai Composite was up 1.02%, while the Shenzhen Component gained 1.86%.

The Caixin/Markit Manufacturing Purchasing Managers’ Index for China came in at 49.4, higher than expectations while marking a third consecutive month of contraction.

.N225 Nikkei 225 Index *NIKKEI 28259.68 290.69 1.04
.HSI Hang Seng Index *HSI 18857.67 260.44 1.4
.AXJO S&P/ASX 200 *ASX 200 7353.2 69 0.95
.SSEC Shanghai *SHANGHAI 3179.06 27.73 0.88
.KS11 KOSPI Index *KOSPI 2485.14 12.61 0.51
.FTFCNBCA CNBC 100 ASIA IDX *CNBC 100 8027.98 145.64 1.85

The Nikkei 225 in Japan rose 1.11% while the Topix rose 0.2%. In South Korea, the Kospi gained 0.5% and the S&P/ASX 200 in Australia rose 0.92%

Overnight in the U.S., major indexes ended the session higher, with the S&P ending its 3-day losing streak and the Dow Jones jumping 700 points after Powell’s comments.

CNBC Pro: Forget Amazon. Here’s what top tech investor Paul Meeks is buying

Investor confidence in the tech sector has been shaken this year amid a flight to safety, but top tech investor Paul Meeks said he is now “more bullish” on the sector than in recent months, though he remains selective within the sector.

He tells CNBC the stocks he favors.

— Zavier Ong

South Korea’s revised GDP confirms growth in the third quarter

South Korea’s revised gross domestic product for the third quarter confirmed growth of 3.1% compared to the same period a year ago – higher than a 2.9% expansion seen in the second quarter.

The economy saw slower quarterly growth of 0.3% in the third quarter, following a growth of 0.7% in the previous period.

Separately, South Korea reported a trade deficit of $7.01 billion for November, exceeding expectations of $4.42 billion — marking the third consecutive month of rising trade deficit driven by sluggish exports.

Exports shrank by 14%, lower than forecasts of a drop of 11% — while imports grew more than expected by 2.7%, according to preliminary data from the customs agency.

– Jihye Lee

CNBC Pro: UBS reveals 15 global stocks sensitive to China’s reopening plans

Chinese stocks have risen this week after the nation’s health authorities reported a recent uptick in vaccination rates, which experts regard as crucial to reopening the country.

The impact of Beijing’s change in tack toward dealing with the outbreak of Covid-19 is being felt not only in China but also around the world.

The Swiss bank UBS has identified 15 stocks in the MSCI Europe index that will outperform “in an environment where China’s growth rebounds and the country reopens its borders.”

— Ganesh Rao

Powell continues to believe in a path to a soft-ish landing

Federal Reserve Chair Jerome Powell says he continues to believe in a path to a “soft-ish” landing — even if the path has narrowed over the past year.

“I would like to continue to believe that there’s a path to a soft or soft-ish landing” Powell said at the Brookings Institution.

“Our job is to try to achieve that, and I think it’s still achievable,” Powell said. “If you look at the history, it’s not a likely outcome, but I would just say this is a different set of circumstances.”

— Sarah Min

Indexes jump on Powell comments

Fed Chair Jerome Powell’s comments indicating the central bank will slow future interest rate hikes as soon as December put upward pressure on the three major indexes.

The S&P 500 jumped up 0.6% from the red on the news.

The Dow was near flat after trading down for most of the day.

The Nasdaq Composite gained steam to 1.3% up.

— Alex Harring

Powell says Fed can “moderate the pace” of future rate increases due to lagged effect of past hikes

Federal Reserve chairman Jerome Powell told an audience at the Brookings Institution Wednesday that the central bank can afford to ease back on its tighter monetary policy at its December meeting (due to wrap up Dec. 14).

The lagged effect of higher rates already taken in 2022, plus the drawing down of the size of the Fed’s balance sheet through quantitative tightening, mean “it makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down,” Powell said.

“The time for moderating the pace of rate increases may come as soon as the December meeting,” said the 69-year-old Fed chair.

In response to Powell’s remarks, the S&P 500 quickly gained to about 3970 vs about 3950 before the address.

— Scott Schnipper, Jeff Cox

Source : CNBC

You might also like

Leave a Reply

Enter Captcha Here :