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Powell’s comments push Asian markets higher

(RTTNews) – Asian stock markets are mostly higher on Wednesday, following broadly positive signals from Wall Street overnight, as traders indulged in buying after positive comments from the US Fed Chairman, Jerome Powell, on the strength of the economy and the news of the lifting of lockdown restrictions in China. Asian markets closed mostly higher on Tuesday.

Persistent inflation and aggressive rate hikes had fueled fears of a possible recession. Powell said he was confident the central bank could raise rates and deal with inflation without sending the economy into recession. He added that the economy is strong and well positioned to withstand less accommodative monetary policy.

Expectations of a pick-up in demand in China also boosted market sentiment after Shanghai pledged to gradually ease its COVID-19 lockdown restrictions in stages in June. Shanghai is seeing a sharp upturn in COVID cases.

The Australian stock market is significantly higher on Wednesday, extending gains from the previous three sessions, with the benchmark S&P/ASX 200 index just below the 7,200 level, following broadly positive signals from Wall Street overnight, driven by gains in materials and technology stocks. . Traders also digested hawkish comments from US Fed Chairman Jerome Powell on the outlook for interest rates and the economy.

The Reserve Bank of Australia also revealed in the minutes of its May meeting that the central bank may raise interest rates further in June. The minutes show that the cash rate could increase to 1.75% by the end of the year and reach 2.5% by the end of 2023.

The benchmark S&P/ASX 200 gained 60.70 points or 0.85% to 7,173.20, after hitting a high of 7,199.00 earlier. The broader All Ordinaries index is up 65.00 points or 0.88% at 7,415.60. Australian stocks ended slightly higher on Tuesday.

Among the major miners, OZ Minerals gains more than 4%, Rio Tinto is up more than 2%, Fortescue Metals adds more than 1%, mineral resources are up 3.5% and BHP Group is up more than 3% . Oil inventories are mostly lower. Woodside Petroleum is down 0.3% and Beach Energy is down more than 1%, while Santos is up 0.5%. The original energy is flat.

In the tech space, WiseTech Global and Appen are up more than 2% each, while Xero adds nearly 1%, Zip is up more than 1%, and Afterpay owner Block is up more than 3% .

Among the big four banks, ANZ Banking gained more than 1% and Westpac rose 0.3%, while Commonwealth Bank and National Australia Bank were flat.

Among gold miners, Gold Road Resources and Northern Star Resources each gained nearly 1%, while Newcrest Mining gained 0.3%, Resolute Mining gained nearly 2% and Evolution Mining gained 1.5%.

In the currency market, the Australian dollar is trading at $0.701 on Wednesday.

Japan’s stock market is sharply higher on Wednesday, extending gains from the previous three sessions, with the Nikkei 225 rising above the 26,800 level, following broadly positive signals from Wall Street overnight as traders reacted to data of GDP better than expected. . They also reacted to hawkish comments from US Fed Chairman Jerome Powell on the outlook for interest rates and the economy.

The benchmark Nikkei 225 closed the morning session at 26,851.15, up 191.40 points or 0.72%, after hitting a high of 27,053.18 earlier. Japanese stocks closed slightly higher on Tuesday.

Market heavyweight SoftBank Group gained nearly 2%, while operator Uniqlo Fast Retailing fell 0.4%. Among automakers, Honda added almost 2% and Toyota a slight increase of 0.5%.

In technology, Screen Holdings gained 0.3%, Advantest gained 1.5% and Tokyo Electron gained more than 2%.

In banking, Mizuho Financial is up over 2%, Sumitomo Mitsui Financial is up almost 2%, and Mitsubishi UFJ Financial is up almost 1%. Among major exporters, Sony gained nearly 2%, Canon gained nearly 1% and Mitsubishi Electric gained 0.4%, while Panasonic lost nearly 1%.

Among the other main gainers, M3, Fujitsu, IHI and Japan Steel Works are up more than 4%, while Nissan Motor adds almost 4%. Kawasaki Heavy Industries, NTT Data, Hino Motors, Nintendo, Asahi Group and Isuzu Motors each earn more than 3%.

Conversely, CyberAgent and Kikkoman lose almost 3% each.

In economic news, Japan’s gross domestic product contracted an annualized 1.0% in the first quarter of 2022, the Cabinet Office said during Wednesday’s preliminary reading. That beat expectations for a 1.8% drop after the downwardly revised 3.8% increase in the previous three months (originally 5.4%). On a seasonally adjusted quarterly basis, GDP fell 0.2% – but that also beat forecasts of a 0.4% decline after the downwardly revised gain of 0.9% over the past few months. previous three months.

In the currency market, the US dollar is trading in the lower range of 129 yen on Wednesday.

Elsewhere in Asia, Indonesia and Taiwan are up 1.4 and 1.0%, respectively, while New Zealand, Singapore, South Korea and Malaysia are up 0.1 to 0, 9% each. Hong Kong and China are down 0.7 and 0.5%, respectively. On Wall Street, stocks remained firm throughout the day’s session after opening on a positive note on Tuesday morning, and closed with strong gains on sustained buying at multiple tellers. Strong retail sales and industrial production data, upbeat earnings updates and positive comments from Fed Chairman Jerome Powell on the strength of the economy helped lift sentiment.

The major averages all ended in impressive gains. The Dow finished with a gain of 431.17 points or 1.34% at 32,654.59. The S&P 500 was up 80.84 points or 2.02% at 4,088.85, while the Nasdaq climbed 321.73 points or 2.76% to settle at 11,984.52 , just a few points off the high of the day.

Major European markets also rallied on encouraging economic data from the region. Britain’s FTSE 100 gained 0.72%, Germany’s DAX jumped 1.59% and France’s CAC 40 rose 1.3%.

Crude oil prices pared early gains and stabilized on Tuesday, reacting to reports that the Biden administration is preparing to ease some of the sanctions imposed on Venezuela. West Texas Intermediate crude oil futures for June ended down $1.80 or 1.6% at $112.40 a barrel.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.