1. Asian stocks advance after worries over Federal rate hike ease

Asian stocks advance after worries over Federal rate hike ease

Asian stocks were mostly higher on Tuesday after a Federal Reserve board member said she was in no hurry to raise interest rates, reassuring investors who were worried that the rate hike could pull share prices lower.

By: | Seoul | Published: September 13, 2016 11:47 AM
On Tuesday, Lael Brainard, an influential Fed policymaker, suggested in a speech that the risk that higher rates might derail growth was greater than the risk that lower rates might ignite inflation. (Reuters) On Tuesday, Lael Brainard, an influential Fed policymaker, suggested in a speech that the risk that higher rates might derail growth was greater than the risk that lower rates might ignite inflation. (Reuters)

Asian stocks were mostly higher on Tuesday after a Federal Reserve board member said she was in no hurry to raise interest rates, reassuring investors who were worried that the rate hike could pull share prices lower.

KEEPING SCORE: Japan’s Nikkei 225 gained 0.2 percent to 16,704.94 and South Korea’s Kospi rose 0.6 percent to 2,002.42. Hong Kong’s Hang Seng index gained 0.8 percent to 23,482.47 while Australia’s S&P/ASX 200 was up 0.1 percent to 5,222.00. The Shanghai Composite index fell 0.2 percent and markets in Southeast Asia were mostly lower.

US RATE WATCH: On Tuesday, Lael Brainard, an influential Fed policymaker, suggested in a speech that the risk that higher rates might derail growth was greater than the risk that lower rates might ignite inflation. That was seen as a sign the Fed will refrain from raising rates at a policy-setting meeting next week. Low rates have fueled a steady rise in stock prices as investors put their money in high-risks stocks instead of low-interest savings accounts or bonds.

ANALYST’S COMMENT: ”She highlighted global challenges such as muted inflation and global uncertainties and particular concerns for the US economy,” said Bernard Aw, a market strategist at IG in Singapore. ”It’s safe to assume that investors believe that September is not going to be the month where the Fed pulls the trigger.”

WALL STREET: US stocks surged Monday after Brainard’s speech. The Dow Jones industrial average jumped 239.62 points, or 1.3 percent, to 18,325.07. The Standard & Poor’s 500 index rose 31.23 points, or 1.5 percent, to 2,159.04. The Nasdaq composite surged 85.98 points, or 1.7 percent, to 5,211.89

OIL: Benchmark US crude fell 45 cents to $45.85 per barrel in New York. The contract added 41 cents on Monday. Brent crude, the benchmark for international oil trading, lost 40 cents to $47.92 a barrel in London.

CURRENCIES: The dollar rose to 101.98 yen from 101.89 yen while the euro slipped to $1.1233 from $1.1238.

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