Asian Markets Stage Rally After Strong Wall St
Fahad Shabbir (@FahadShabbir) Published October 17, 2018 | 10:06 AM
Hong Kong, (UrduPoint / Pakistan Point News - 17th Oct, 2018 ) :Asian markets staged a much-needed rally Wednesday as investors tracked Wall Street's best performance in more than six months thanks to a healthy round of earnings reports.
Bargain-buyers took advantage of the strong readings from some of the world's top firms to step back into the mix, with a dip in US Treasury yields and a US announcement of trade talks with Japan, the EU and Britain helping sentiment.
The news helped distract from long-running worries about the trade war between China and the United States that shows no sign of abating.
Investors are now awaiting the release later in the day of minutes from the Federal Reserve's most recent policy meeting, hoping for some insight into its plans for interest rates in light of fresh strong data on the US economy.
All three main indexes in New York piled on more than two percent Tuesday, the best daily performance since March, in response to a string of positive results from the likes of Netflix, Goldman Sachs, Johnson & Johnson and UnitedHealth Group.
And the gains filtered through to Asia, where Tokyo ended the morning session 1.6 percent higher thanks to a pick-up in the Dollar against the Yen, while Shanghai gained 0.6 percent.
Sydney, Seoul, Singapore, Manila and Taipei each put on more than one percent, while Wellington was also in a strong position.
Hong Kong was closed for a public holiday.
However, Stephen Innes, head of Asia-Pacific trade at OANDA, said: "Perhaps a bit surprising is that local equity markets are not exactly knocking it out of the park this morning.
"I suspected they would take their lead from the US equity froth. But again, local dealers remain a better seller of risk until a definitive shift in US-China trade tensions is offered up." On Currency markets the dollar was down against most high-yielding and emerging market economies as traders came out of their shell after recent selling.
Ray Attrill, head of forex strategy at National Australia Bank, suggested Donald Trump's latest outburst against the Fed's rate hikes, which he claims are too much, were weighing on the dollar.
"While such name calling shouldn't mean anything in terms of what the Fed actually does, it is a factor which somewhat undermines sentiment towards the dollar," he said.
"We'd argue, (it) is a contributory factor, albeit minor, to recent poor performance of the US dollar in the face of first higher US yields, then last week's sharp turn for the worse in US equity market."
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