Asian markets mostly up after Fed minutes
A woman walks past electronic boards showing share index at a bank in Kuala Lumpur, Malaysia, on Oct. 3, 2014. Asian markets mostly rose Thursday, Oct. 9, following an upswing on Wall Street as minutes from the Federal Reserve’s latest meeting indicated policymakers were nervous about hiking interest rates too soon. AP PHOTO/LAI SENG SIN
HONG KONG–Asian markets mostly rose Thursday following an upswing on Wall Street as minutes from the Federal Reserve’s latest meeting indicated policymakers were nervous about hiking interest rates too soon.
The minutes show the central bank board aired worries about the stronger dollar, a stumbling eurozone economy, slowing growth in China and Japan and geopolitical risks.
The news also sent the euro and yen up against the greenback as dealers contemplated several more months of record-low rates.
Sydney rallied 1.06 percent, or 55.43 points, to close at 5,296.7 and Shanghai gained 0.28 percent, or 6.58 points, to 2,389.37 while Hong Kong jumped 1.17 percent, or 271.20 points, to 23,534.53.
However, Tokyo, which rallied in morning trade, slipped 0.75 percent, or 117.05 points, to 15,478.93 owing to the yen’s strength.
Seoul was closed for a public holiday.
Minutes of the Federal Open Market Committee meeting showed that despite strong domestic data, members debated changing their signal on the timing of a rate hike owing to problems overseas.
“Some participants expressed concern that the persistent shortfall of economic growth and inflation in the euro area could lead to a further appreciation of the dollar and have adverse effects on the US external sector,” the minutes said.
“Several” of them added “that slower economic growth in China or Japan or unanticipated events in the Middle East or Ukraine might pose a similar risk.”
The post-meeting statement said it would wait for some “considerable time” before lifting rates but according to the minutes there were fears that the reference “could be misunderstood as a commitment rather than as data dependent.”
Michael James, managing director of equity trading at Wedbush Securities, said: “Traders’ interpretation was that rates are not going to be going up that much or as quickly as maybe people are fearing.”
The news pushed US shares surging, with the Dow up 1.62 percent, the S&P 500 jumping 1.73 percent and the Nasdaq climbing 1.90 percent.
Dollar retreats
A string of impressive US data in recent months has fueled speculation the Fed will likely announce a rise before a mid-2015 timetable.
This has sent the dollar to multi-year highs against major currencies while also hitting Asian equities as traders take their cash back to the United States for better investment returns.
But in currency dealing Thursday the yen and euro made inroads against the greenback.
In New York the euro climbed to $1.2734 from $1.2667.
And in Asian trade Thursday the single currency–which sank to a two-year low of $1.2500 last week as the eurozone economy struggles–was at $1.2773. It also fetched 137.61 yen compared with 137.71 yen.
The dollar was at 107.73 yen against 108.14 yen in New York Wednesday. The greenback is sharply down from the six-year highs above 110 yen seen late last week.
Oil prices rebounded after a recent sell-off. US benchmark West Texas Intermediate (WTI) for November delivery was up 40 cents at $87.71 a barrel in afternoon trade after hitting an 18-month low in New York on Wednesday.
Brent crude for November advanced 23 cents to $91.61 after tumbling to a two-year low the day before.
Gold was at $1,230.80 an ounce against $1,217.96 late Wednesday.
In other markets:
— Mumbai’s benchmark Sensex index closed up 1.49 percent, or 390.49 points, to 26,637.28.
Reliance Industries was up 1.87 percent at 954.65 rupees and auto-maker Mahindra & Mahindra was down 0.38 percent at 1367.50 rupees.
— Bangkok rose 1.12 percent, or 17.22 points, to 1,560.61.
Kasikorn Bank climbed 2.22 percent, or 5 baht, to 230 while telecoms company True Corporation gained 5.50 percent, or 0.60 baht, to 11.50.
— Jakarta ended up 0.71 percent, or 35.36 points, at 4,993.88
Paper manufacturer Pabrik Kertas Tjiwi Kimia gained 3.28 percent to 945 rupiah, while telecoms firm Indosat slipped 1.16 percent to 3,850 rupiah.
— Singapore rose 1.01 percent, or 32.54 points, to close at 3,259.25.
Singapore Telecom advanced 1.60 percent to Sg$3.80 and United Overseas Bank ended 1.12 percent higher at Sg$22.49.
— Kuala Lumpur’s main share index edged up 5.41 points, or 0.3 percent, to close at 1829.73.
Plantations giant Sime Darby gained just 0.11 percent to 9.10 ringgit after announcing plans to acquire Papua New Guinea-based palm oil producer New Britain Palm Oil Ltd in a $1.7 billion deal.
— Taipei added 0.13 percent, or 11.26 points, to 8,966.44.
Taiwan Semiconductor Manufacturing Co. rose 2.04 percent to Tw$125.0 while Hon Hai was 0.93 percent higher at Tw$97.6.
— Wellington rose 0.38 percent, or 20.14 points, to 5,266.04.
Chorus was up 2.66 percent at NZ$1.93 and Spark ended down 1.69 percent at NZ$2.91.
— Manila gained 0.23 percent, or 16.21 points, to 7,201.89.
