Asian Markets Rally As Investors See Positive In US Gridlock 08 November 2018

Asian markets climbed Thursday, building on a global rally as investors bet that gridlock in Washington will clip Donald Trump's wings, preventing him from driving through measures that would likely push up US interest rates.

Hong Kong, (UrduPoint / Pakistan Point News - 8th Nov, 2018 ) :Asian markets climbed Thursday, building on a global rally as investors bet that gridlock in Washington will clip Donald Trump's wings, preventing him from driving through measures that would likely push up US interest rates.

Attention now turns to the end of the Federal Reserve's policy meeting later in the day, with its plans for hiking borrowing costs closely watched.

Bets the central bank would lift rates again next month and continue to do so through 2019 have been a major cause of worry on trading this year but with the chances of more Trump tax cuts greatly reduced, expectations have been tempered.

However, analysts do not expect the Fed to alter its most recent outlook for the economy, with Ian Shepherdson of Pantheon Macroeconomics, saying: "The economic picture hasn't changed meaningfully since the September meeting, despite the gyrations in the stock market." But with Democrats now controlling the House and ready to hold the president to account, observers expect them to push back against a number of his measures, though work with him on others such as infrastructure spending leading into the 2020 vote.

"With trade tensions to the fore over recent months and risk currencies in the spotlight, the US midterms were being seen through the prism of whether the outcome might embolden the president to go harder on trade or in effect if the elections would clip his wings," said National Australia Bank economist David de Garis.

"With the Democrats gaining control over the House, the latter scenario now might be a little more likely." However, Stephen Innes, head of Asia-Pacific trading at OANDA added the result "has left analysts debating what this will mean for policy going forward".

All three main Wall Street indexes ended more than two percent higher. And the positive mood was reflected in Asia, where Tokyo went into the break almost two percent up.

Hong Kong added 0.8 percent, Shanghai gained 0.4 percent and Seoul jumped 1.4 percent, while Sydney rose 0.5 percent.

Wellington and Taipei put on 0.4 percent each and Jakarta edged up 0.2 percent.