Asian markets rise as traders are supported by another Wall St rally

Published on: Amended:

Hong Kong (AFP) – Asian markets rose in limited trade on Tuesday after another strong lead from Wall Street fueled by a rebound in tech companies, while comments from Federal Reserve officials eased fears it was embarking on an aggressive phase of political tightening.

US stocks rallied for a second day with plenty of support coming from Apple’s earnings report last week, as the current reporting season proved fruitful despite concerns over inflation and the pullback from the financial support from central banks.

Wall Street’s surge came at the end of a volatile month characterized by speculation over Fed plans to rein in runaway prices, with fears its new hawkish tilt could see it raise borrowing costs up seven times this year with a 50 basis point move in March.

Comments from some senior figures at the bank over the weekend reinforced expectations that the board would move fast and hard, even though some had come out on Monday to try to play down such a move.

Atlanta Fed boss Raphael Bostic said he did not favor such a hike next month, after telling the Financial Times over the weekend that his colleagues had not ruled it out.

Meanwhile, Kansas City Fed President Esther George said it was “in no one’s interest to try to upend the economy with unexpected adjustments,” and the head of the San Francisco branch Mary Daly added that the measures “must be incremental and non-disruptive.” “.

The Nasdaq climbed more than 3%, cutting January losses to 9%, after at one point falling nearly 15% in the month, while the S&P 500 and Dow also posted healthy gains. .

And the positive energy continued in Asia, with Tokyo, Sydney and Wellington on the rise.

However, business was weak due to the Chinese New Year break which saw the closure of Hong Kong, Shanghai, Singapore, Seoul, Taipei, Manila and Jakarta.

It was also hoped that the rally could indicate that the markets bottomed out after the recent selloff.

“The consecutive rise in US stocks has some wondering if the bottom has passed,” National Australia Bank’s Tapas Strickland said.

“Despite talk of higher rates, earnings so far have been much better than expected. Not sure we’ve bottomed out, but sure value is coming back.”

And Solita Marcelli, of UBS Global Wealth Management, said in a comment: “Investors should keep in mind that the economy remains strong, which should limit declines from current levels.”

Traders are now awaiting policy decisions from the Bank of England and the European Central Bank this week, while US job creation data due on Friday could provide a fresh look at the world’s biggest economy in the run. light of inflation and rate hike expectations.

Oil prices extended their recent rally on demand optimism and the Russian-Ukrainian stalemate stoking concerns over a potential supply hit. The decision by OPEC and other major producers not to increase production beyond current levels was also a factor, analysts added.

“January was a great month for oil prices and $100…may not be too far off as expectations are high that supply won’t come close to catching up with demand as OPEC+ will provide targets for incremental increases in production that they will not be able to meet. achieve,” said Edward Moya of OANDA.

– Key figures around 02:30 GMT –

Tokyo – Nikkei 225: 0.7% higher at 27,194.66 (pause)

Hong Kong – Hang Seng Index: Closed for a public holiday

Shanghai – Composite: Closed for a public holiday

Euro/dollar: DOWN to $1.1226 vs. $1.1235 Monday night

Pound/dollar: DOWN to $1.3441 from $1.3445

Euro/pound: DOWN to 83.52 pence vs. 83.54 pence

Dollar/yen: DOWN to 115.10 yen from 115.13 yen

West Texas Intermediate: UP 0.1% to $88.27 a barrel

North Sea Brent Crude: UP 0.1% to $89.37 a barrel

New York – Dow: UP 1.2% to 35,131.86 (closing)

London – FTSE 100: FLAT at 7,464.37 (closing)

Comments are closed.