Asia report: Most markets rise after Fed rate hike
Most stock markets in the Asia-Pacific region closed higher on Thursday, after the US Federal Reserve hiked interest rates by 75 basis points overnight.
In Japan, the Nikkei 225 was up 0.36% at 27,815.48, as the yen strengthened 0.81% on the dollar to last trade at JPY 135.47.
Tech investing giant SoftBank Group slipped 0.56%, while robotics specialist Fanuc jumped 3.66% and Uniqlo owner Fast Retailing gained 0.39%.
The broader Topix index managed gains of 0.16% by the end of trading in Tokyo, settling at 1,948.85.
On the mainland, the Shanghai Composite was 0.21% firmer at 3,282.58, and the technology-centric Shenzhen Component was ahead 0.23% at 12,428.72.
South Korea’s Kospi advanced 0.82% to 2,435.27, while the Hang Seng Index in Hong Kong was down 0.23% at 20,622.68.
The blue-chip technology stocks were mixed in Seoul, with SK Hynix down 0.6%, while Samsung Electronics managed to rise 0.16%.
Samsung reported slightly better-than-expected second quarter profit earlier in the session at KRW 14.1trn.
It was the technology giant’s best second quarter result since 2018, and was ahead of its own forecast for KRW 14trn.
The moves in Asia came after policymakers stateside lifted the Fed funds rate target by 75 basis points, taking it to its highest level since 2018 at between 2.25% and 2.5%.
Federal Reserve chair Jerome Powell’s comments on the central bank’s next moves, however, gave equities a boost.
“As the stance of monetary policy tightens further, it likely will become appropriate to slow the pace of increases while we assess how our cumulative policy adjustments are affecting the economy and inflation,” Powell said.
Expectations for a 50-basis point rise at the Fed’s next meeting in September stood at 66% earlier in the Asian day, according to CME FedWatch.
“It wasn’t so much what the Fed did, since a 75-basis point increase in rates was widely expected, as what it said in noting that some economic data had started to soften,” said AJ Bell investment director Russ Mould.
“This gave investors at least a hint that it might start to ease its foot off the rate acceleration pedal a touch, and helped Asian markets make progress overnight.”
Oil prices were higher as the region went to bed, with Brent crude futures last up 1.44% on ICE at $108.15 per barrel, and West Texas Intermediate ahead 1.97% at $99.18 on NYMEX.
In Australia, the S&P/ASX 200 was 0.97% higher at 6,889.70, as fresh data showed retail sales rising 0.2% in June.
That was down from the 0.9% growth reported for May, and short of the 0.5% pencilled in by economists in a Reuters poll.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 jumped 1.74% to 11,328.19, led higher by freight and logistics group Mainfreight, which jumped 6.3%.
That came after its managing director Don Braid told shareholders at the annual general meeting that a surge in United States trading had lifted group revenue and profit by a respective 32.5% and 82.9% in the 16 weeks since 1 April.
The down under dollars were in a mixed state against the greenback, with the Aussie last 0.08% weaker at AUD 1.4312, while the Kiwi strengthened 0.19% to NZD 1.5936.
Reporting by Josh White at Sharecast.com.