Yahoo Finance Asia-Pacific Investors Hoping to Ride Wall Street, Powell’s Friendly Comments Higher on Opening
The major Asia-Pacific stock indexes are expected to open steady-to-better on Tuesday following another solid performance on Wall Street. The S&P 500 ended its trading session just under a new closing record, while the tech-weighted NASDAQ Composite climbed to an all-time high. The Dow was also higher after posting its best day since March on Monday.
Asia-Pacific traders are likely to get their guidance from Tuesday’s testimony before a House of Representatives panel by Fed Chair Jerome Powell, which began at 18:00 GMT.
Powell reaffirmed the U.S. central bank’s intent to encourage a “broad and inclusive” recovery of the job market, and not to raise interest rates too quickly based only on the fear of coming inflation.
“We will not raise interest rates preemptively because we fear the possible onset of inflation. We will wait for evidence of actual inflation or other imbalances,” Powell said.
Recent price increases “don’t speak to a broadly tight economy” that would require higher interest rates, Powell said, but come from categories “directly affected by reopening” of the economy.
Tuesday’s Cash Market Performance
In the cash market on Tuesday, Japan’s Nikkei 225 Index settled at 28884.13, up 873.20 or +3.12%. Hong Kong’s Hang Seng Index finished at 28309.76, down 179.24 or -0.63% and South Korea’s KOSPI Index closed at 3263.88, up 0.71%.
In China, the benchmark Shanghai Index settled at 3557.41, up 28.23 or +0.80% and in Australia, the S&P/ASX 200 Index finished at 7342.20, up 1.48%.
Nikkei Posts Biggest Gains in a Year as Shippers Hit 10-Year Highs
Japanese shares jumped on Tuesday, tracking Wall Street overnight, boosted by shipping stocks after Mitsui OSK Lines more than tripled its half-yearly net profit forecast. The rise in the benchmark Nikkei marked its biggest percentage gain since June last year.
Shippers led gains, with the top three firms logging a rise of more than 10%, after Mitsui OSK Lines raised its forecast for six-month net income to 170 billion Yen ($1.54 billion) from 50 billion yen.
Automakers were among other stand-out stocks, with Suzuki Motor rallying 7.4% and Toyota Motor adding 3.3% amid a weakening Yen, which boosts exporters’ profits. Home builders also gained.
Australia Shares Rise Most in Nearly 4 Months on Energy, Mining Stocks
Australian shares jumped the most since March on Tuesday, rebounding from the previous session’s drop as an overnight rally on Wall Street spurred investors to pile into domestic energy and mining stocks.
The domestic energy index surged 2.2% as oil prices also advanced. Benchmark heavyweight miners gained 2.1%.
Despite the strong performance, the benchmark index’s gains may have been capped by concerns around COVID-19 cases in the country’s most populous state of New South Wales (NSW).
Looking Ahead to Wednesday
Investors are hoping to ride the strong performance on Wall Street to even higher levels on Wednesday especially since Powell seems to have downplayed the threat of higher inflation and a sooner than expected rate hike.
In the U.S. cash market on Tuesday, the benchmark S&P 500 Index settled at 4246.44, up 21.65 or +0.51%. The blue chip Dow Jones Industrial Average finished at 33945.58, up 69.61 or +0.20% and the tech-heavy NASDAQ Composite closed at 14253.27, up 111.79 or +0.79%.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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Asia-Pacific Investors Hoping to Ride Wall Street, Powell’s Friendly Comments Higher on Opening
