Asian shares tracked Wall Street’s rally on Wednesday, after U.S. central bank comments pointed to increasing prospects of an interest rate cut, boosting investor sentiment and pushing the dollar lower.
Asian Shares
- MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.5%.
- Japan’s Nikkei average climbed 1.9%.
- Chinese shares also rebounded, with the benchmark Shanghai Composite up 0.4% and the blue-chip CSI 300 rising 0.5%.
- Hong Kong’s Hang Seng advanced 0.6%.
- On Wall Street, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite clocked their biggest one-day gains in five months, with all three indexes ending up more than 2% on Tuesday.
Currencies
In the foreign exchange market, major currencies were on the sidelines for now.
- The greenback hit a seven week-low of 96.995 against a basket of six major currencies overnight and was last quoted at 97.045, little changed on the day. The euro fetched $1.1263, up by a marginal 0.1%.
- The pound recovered from a five-month low on Tuesday but concerns about a disorderly departure from the European Union meant gains were minimal, amid promises from U.S. President Donald Trump of a “phenomenal” post-Brexit trade deal. Sterling was last trading a marginally firmer 0.1% at $1.270.
- Other major currencies were relatively calm, with the safe-haven yen still supported but not aggressively so. The yen firmed 0.1% against the dollar to 108.08 yen.
Commodities
- In commodity markets, oil prices resumed their slide on Wednesday, dragged down by a surprise gain in U.S. inventories and comments from the head of Russian state oil producer Rosneft questioning the point of a deal with OPEC to withhold supplies.
- In Asian trade, U.S. crude retreated 0.7% to $53.12 a barrel and Brent crude futures dropped 0.5% to $61.69 per barrel.
Bonds
- The rebound in stock prices also prompted U.S. bond yields to step up from their recent lows, with the 10-year yield off its 21-month low hit earlier in the week.
