-b1480c1e-b15b-4e83-8e36-1691e58ee5d5.jpeg)
Bangkok, Jul 28 (BNA): Most stocks rose in Asia after the Federal Reserve stepped up its campaign against rising inflation by raising its key interest rate by three-quarters of a point.
Hong Kong’s benchmark Hang Seng fell 0.6% to 20554.09 after the territory’s monetary authority matched a 0.75 percentage point Fed rate hike with its own.
HKMA aligns its policies with US monetary moves to keep the Hong Kong dollar at a fixed rate with the US dollar.
Elsewhere in the region, stocks rose, tracking gains on Wall Street after the Fed did exactly as expected, and its boss, Jerome Powell, indicated that the Fed’s rate hike had already had some success in slowing the economy and possibly Reducing inflationary pressures.
Investors await an update on US economic growth and a phone call between US President Joe Biden and Chinese leader Xi Jinping.
While the meeting is not expected to make a concrete decision on tariff relief, any indications of willingness to work towards it are an additional positive for markets, Jun Rong Yeap of IG said in a comment.
Tokyo’s Nikkei 225 rose 0.2% to 27,761.53 while the Shanghai Composite rose 0.6% to 3,294.42. In Seoul, the Kospi advanced 0.7% to 2432.91.
Australia’s S&P/ASX 200 jumped 0.9% to 6,881.80 after the government reported that retail sales rose in June for the sixth consecutive month. Markets in Thailand are closed for a holiday.
On Wall Street, investors welcomed the widely expected move from the Federal Reserve – which raised the key interest rate to the highest level since 2018 – with a broad rally on Wednesday.
The S&P 500 rose 2.6% to 4023.61, and the heavy Nasdaq rose 4.1%, its biggest gain in more than two years, to 12,032.42. The Dow Jones Industrial Average rose 1.4% to 32,197.59. Small-cap stocks also rose, lifting the Russell 2000 Index by 2.4% to 1,848.34.
All indicators are now on track for weekly gains, extending Wall Street’s strong rally in July. The S&P 500 is up 6.3% so far this month.
Bond yields turned broadly lower after the Fed’s announcement. The two-year Treasury yield, which tends to move in line with the Federal Reserve’s forecast, fell to 2.98% from 3.06% late Tuesday.
The 10-year yield, which affects mortgage rates, fell to 2.78% from 2.79%.
Interest rate increases like Wednesday, the fourth so far this year, are making borrowing more expensive and slowing the economy.
The hope is that the Fed and other central banks can ingeniously find a compromise as the economy slows enough to crush inflation but not enough to cause a recession.
Analysts at Citi said that while Powell said a slowdown in rallies would be appropriate at some point, exactly when that might remain unclear, adding that they “would not view this as a particularly dovish comment.”
“We continue to expect core inflation to push the Fed up more aggressively than markets expect or expect,” the analysts wrote, noting that they expect the Fed to announce another three-quarter increase at its September policy meeting, with rate hikes continuing. Benefit. In early 2023.
Meanwhile, some parts of the economy are already slowing, notably the housing industry.
US previously occupied home sales slowed in June for the fifth consecutive month as mortgage rates rose sharply this year.
An update on the economy will be released later on Thursday with US Q2 GDP data.
Shares in Microsoft and Alphabet, the parent company of Google, rose 6.7% and 7.7%, respectively, after their latest quarterly reports.
Spotify Technology jumped 12.2% after the music streaming service reported the number of monthly active users and premium subscribers that exceeded Street expectations.
In another trading session on Thursday, benchmark US crude oil added $1.04 to $98.30 a barrel in electronic trading on the New York Mercantile Exchange. It rose $2.28 to $97.26 on Wednesday.
Brent crude, the international benchmark, rose 93 cents to $102.60 a barrel.
The price of the US dollar was 135.44 Japanese yen, down from 136.55 yen. The euro rose to $1.0208 from $1.0197.
ZHB