Asian stock markets gain after Wall Street rally
BEIJING (AP) — Asian stocks rose Monday after Wall Street rallied as investors looked ahead to the U.S. Federal Reserve chairman’s congressional testimony this week for insights into its economic outlook.
KEEPING SCORE: The Shanghai Composite Index rose 0.3 percent to 3,299.83 and Tokyo’s Nikkei 225 gained 0.8 percent to 22,072.07. Hong Kong’s Hang Seng advanced 0.4 percent to 31,393.64 and Seoul’s Kospi added 0.2 percent to 2,456.44. Australia’s S&P-ASX 200 was up 0.5 percent at 6,028.20 and benchmarks in New Zealand, Taiwan and Singapore also advanced. Manila and Jakarta declined.
WALL STREET: Wall Street capped several days of choppy trading with a rally that gave the stock market a modest gain for the week. Technology companies, banks and health care stocks accounted for much of the market’s gains. Energy companies also rose along with crude oil prices. The Standard & Poor’s 500 index climbed 1.6 percent to 2,747.30. The Dow Jones industrial average picked up 1.4 percent to 25,309.99. The Nasdaq composite gained 1.8 percent to 7,337.39.
FED WATCH: Investors are watching Chairman Jerome Powell’s testimony Tuesday for insight into the Fed’s outlook. Private sector analysts expect few significant changes in forecasts U.S. inflation will rise toward its 2 percent target and wage growth will stay moderate. Some traders are looking for the Fed to affirm a gradual pace of one interest rate hike per quarter this year.
ANALYST’S TAKE: “Obviously the biggest aspect from Fed Powell’s first testimony to Congress to watch would be comments surrounding interest rate and inflation expectations, but one should not be surprised if the Fed chair rehashes the current rhetoric in order to not rock the market,” said Jingyi Pan of IG in a report. “Over and above the views on rates, insights into the recent bout of volatility and debt concerns may also be market-moving pieces.”
THIS WEEK: A Chinese industry group releases its February manufacturing barometer Tuesday amid expectations it may show activity edging down due to the Lunar New Year holiday leaving the month with fewer work days. Also Tuesday, the South Korean central bank holds a policy meeting, but forecasters expect no additional rate hike. On Wednesday, India reports fourth quarter gross domestic product; and the consensus calls for 6.9 percent growth over a year earlier. India’s central bank is due to release minutes of its February meeting. On Thursday, Australia reports private investment growth.
ENERGY: Benchmark U.S. crude gained 30 cents to $63.85 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 78 cents on Friday to close at $63.55. Brent crude, used to price international oils, advanced 22 cents to $67.53 in London. It jumped 92 cents the previous session to $67.31.
CURRENCY: The dollar declined to 106.49 yen from Friday’s 106.88 yen. The euro gained to $1.2317 from $1.2298.