Asian Shares Rise On Fed Optimism

Asian stocks rose broadly on Wednesday amid expectations the U.S. Federal Reserve will ease the pace of rate increases, citing slowing wage and inflation growth.

The upside, however, remained capped by a slew of disappointing U.S. earnings reports released after market close on Tuesday as well as data showing hotter-than-expected inflation in Australia.

Trading volumes were thin, as markets in Taiwan, China and Hong Kong remained closed for the Lunar New Year holidays.

The U.S. dollar index traded weak and U.S. crude oil prices held steady near $80 a barrel, while gold prices dipped after reaching a nine-month peak in the previous session.

Japanese stocks ended modestly higher in choppy trading as investors awaited cues from the corporate earnings season.

The Nikkei 225 Index rose 0.4 percent to 27,395.01, while the broader Topix ended 0.4 percent higher at 1,980.69.

Motor maker Nidec slumped 5.4 percent and precision tools maker Disco lost 3.5 percent on disappointing earnings updates.

Australian markets snapped a five-day winning streak and the Aussie dollar rallied to a five-month high after data showed the country’s inflation rate hit a 33-year high in the final quarter of 2022, increasing pressure on the Reserve Bank to keep raising rates for longer.

The benchmark S&P/ASX 200 Index slipped 0.3 percent to 7,468.30, while the broader All Ordinaries Index ended down 0.3 percent at 7,688.

Tech and commodity-related stocks led losses, while financials ended broadly higher on bets they will gain from higher interest rates.

Across the Tasman, New Zealand’s benchmark S&P/NZX 50 Index rose 0.5 percent to 11,994.51. The country’s consumer price index remained pinned to a 32-year high in the fourth quarter, data released earlier in the day showed, but the annual rate was lower than the Reserve Bank’s expectations.

Seoul stocks posted strong gains as trading resumed after a long holiday weekend. The Kospi jumped 1.4 percent to 2,428.57. Tech heavyweights topped the gainers list, with Samsung Electronics and SK Hynix climbing 2-4 percent.

U.S. stocks ended mixed overnight amid a deluge of earnings and hopes of a less aggressive Federal Reserve.

The tech-heavy Nasdaq Composite slipped 0.3 percent and the S&P ended marginally lower, while the Dow rose 0.3 percent to extend gains for a third straight session.

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