Asian Markets Rally Amid Wall Street Cues

Mirroring the broadly positive cues from Wall Street overnight, Asian stock markets are trading mostly higher on Thursday, amid optimism over the outlook for interest rates after the US Fed left interest rates unchanged and the accompanying statement signaled three interest rate cuts next year as inflation eased over the past year. Asian Markets closed mixed on Wednesday.

The median forecast indicates rates will be lowered to 4.6 percent by the end of 2024. During his post-meeting press conference, Fed Chair Jerome Powell acknowledged that rate cuts will be a “topic of discussion” at upcoming meetings.

The Australian stock market is sharply higher on Thursday, extending the gains in the previous four sessions, following the broadly positive cues from Wall Street overnight. The benchmark S&P/ASX 200 is moving well above the 7,300 level, with gains across most sectors led by mining and technology stocks.

The market is upbeat after the US Fed left interest rates unchanged and the accompanying statement signaled interest rate cuts next year.

The benchmark S&P/ASX 200 Index is gaining 116.70 points or 1.61 percent to 7,374.50, after touching a high of 7,380.20 earlier. The broader All Ordinaries Index is up 124.10 points or 1.66 percent to 7,593.20. Australian stocks ended modestly higher on Wednesday.

Among major miners, BHP Group and Rio Tinto are gaining more than 1 percent each, while Fortescue Metals is adding 1.5 percent and Mineral Resources is surging more than 7 percent.

Oil stocks are mostly higher. Santos is gaining more than 1 percent and Origin Energy is adding almost 1 percent, while Woodside Energy and Beach energy are edging up 0.5 percent each.

In the tech space, WiseTech Global is gaining 3.5 percent, Appen is adding almost 2 percent, Afterpay owner Block is losing almost 1 percent, Xero is advancing almost 3 percent and Zip is soaring almost 9 percent.

Among the big four banks, Commonwealth Bank and Westpac are gaining almost 1 percent each, while National Australia Bank is edging up 0.5 percent and ANZ Banking is adding more than 1 percent.

Among gold miners, Resolute Mining is advancing almost 5 percent, Northern Star Resources is surging more than 7 percent, Gold Road Resources is soaring almost 8 percent, Evolution Mining is gaining 4.5 percent and Newmont is adding more than 5 percent.

In other news, shares in Genesis Minerals are jumping more than 11 percent after striking a deal to buy the Bruno-Lewis and Raeside gold projects from Kin Mining.

In economic news, Australia gained 61,500 jobs in November, the Australian Bureau of Statistics said on Friday, for a total of 14,257.00. That blew away expectations for an increase of 11,000 jobs following the addition of 55,000 jobs in October. The participation rate improved to 67.2 percent, beating expectations for 66.9 percent and up from 67.0 percent in October.

In the currency market, the Aussie dollar is trading at $0.672 on Thursday.

Snapping the three-session winning streak, the Japanese stock market is notably lower on Thursday after opening in the green, despite the broadly positive cues from Wall Street overnight. The Nikkei 225 is falling to be a tad above the 32,800 level, with losses across most sectors led by exporters, financial and technology stocks amid the strengthening of the yen against the US dollar.

The benchmark Nikkei 225 Index closed the morning session at 32,801.15, down 125.20 points or 0.38 percent, after hitting a low of 32,708.77 and a high of 33,120.55 earlier. Japanese stocks closed modestly higher on Wednesday.

Market heavyweight SoftBank Group is gaining more than 3 percent and Uniqlo operator Fast Retailing is edging up 0.5 percent. Among automakers, Toyota is declining almost 4 percent and Honda is slipping more than 4 percent.

In the tech space, Advantest is losing almost 3 percent, Tokyo Electron is edging down 0.3 percent and Screen Holdings is down almost 1 percent.

In the banking sector, Sumitomo Mitsui Financial is losing more than 4 percent, while Mizuho Financial and Mitsubishi UFJ Financial are declining almost 4 percent each.

Among the major exporters, Canon is losing almost 2 percent, Mitsubishi Electric is down almost 1 percent, Panasonic is declining more than 4 percent and Sony is slipping more than 2 percent.

Among other major losers, Mitsubishi Motors is plunging more than 7 percent and Mazda Motor is losing almost 6 percent, while Toho, T&D Holdings and Kawasaki Heavy Industries are declining almost 5 percent each. Resona Holdings, Chiba Bank, Fukuoka Financial, Nissan Motor, JTEKT, Tokyo Electric Power and Dai-ichi Life are down more than 4 percent each.

Conversely, Recruit Holdings is surging more than 8 percent, Sumco is gaining almost 4 percent and Shin-Etsu Chemical is adding almost 3 percent.

In economic news, the value of core machine orders in Japan was up a seasonally adjusted 0.7 percent on month in October, the Cabinet Office said on Thursday, coming in at 858.7billion yen. That beat expectations for a decline of 0.5 percent following the 1.4 percent increase in September.

On a yearly basis, core machine orders fell 2.2 percent – but that also topped forecasts for a drop of 5.1 percent following the 2.2 percent drop in the previous month. For the fourth quarter of 2023, core machine orders are forecast to add 0.5 percent on quarter but fall 1.6 percent on year at 2,550.6 billion yen. The total value of machinery orders received by 280 manufacturers operating in Japan decreased 7.6 percent on month in October.

In the currency market, the U.S. dollar is trading in the higher 141 yen-range on Thursday.

Elsewhere in Asia, New Zealand, China, Hong Kong, Singapore, South Korea, Malaysia, Indonesia and Taiwan are higher by between 0.2 and 1.1 percent each.

On Wall Street, stocks turned in a lackluster performance throughout much of the trading session on Wednesday before skyrocketing in reaction to the Federal Reserve’s monetary policy announcement. With the late-day rally, the Dow soared to a record closing high, while the Nasdaq and the S&P 500 reached their best closing levels in almost two years.

The Dow saw further upside going into the close, spiking 512.30 points or 1.4 percent on the day to 37,090.24. The Nasdaq shot up 200.57 points or 1.4 percent to 14,733.96 and the S&P 500 jumped 63.39 points or 1.4 percent to 4,707.09.

Meanwhile, the major European markets finished the day narrowly mixed. While the U.K.’s FTSE 100 Index inched up by 0.1 percent, the German DAX Index and the French CAC 40 Index both dipped by 0.2 percent.

Crude oil prices climbed higher on Wednesday after data showed a bigger than expected drop in U.S. crude inventories last week. West Texas Intermediate Crude oil futures for January ended higher by $0.86 or 1.3 percent at $69.47 a barrel.

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