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Asian stocks rise as Fed sees modest US growth

Last Updated: Thursday, April 26, 2012 - 09:38

Bangkok: Asian stock markets rose Thursday after surging Apple shares propelled the Nasdaq to its biggest gain of the year and the US Federal Reserve predicted moderate growth for the world's No. 1 economy.

Japan's Nikkei 225 index inched up 0.1 percent to 9,571.57 as exporters pushed higher despite an uptick in the yen against the dollar. Hong Kong's Hang Seng gained 0.5 percent to 10,755.34 and South Korea's Kospi added 0.3 percent to 1,968.29.

US financial markets barely budged after the Federal Reserve, following a two-day policy
meeting, said Wednesday it would stick with its plan to keep its key short-term interest rate near zero.

Still, the Fed's assessment that US economic growth would pick up gradually remained a source of near-term comfort for investors, especially in Asia which relies on the US as a crucial market for its exports of cars, electronics, textiles and other goods.

Analysts at Credit Agricole CIB in Hong Kong said in an email that they remain skeptical "about the ability of risk assets (such as stocks) to continue rallying but acknowledge that at least in the near term the Fed has put a floor under such assets."

The Fed detailed no plans to extend its bond-buying program when the current iteration ends in June, although Fed chairman Ben Bernanke made clear that if the economy slows, the Fed could take further steps to boost growth.

Elsewhere in Asia, the Australian stock exchange was higher after a public holiday Wednesday. The S&P/ASX 200 rose 0.4 percent to 4,378.80. Benchmarks in Taiwan, Indonesia and the Philippines also rose while mainland China, Singapore and New Zealand fell.

Among individual stocks, Hong Kong-listed China Everbright International Ltd. shot up 4.6 percent, following the resignation of vice chairman and executive director Li Xueming. Li is the older brother of Bo Xilai, a powerful Chinese politician felled by a messy scandal involving the high-profile murder of a British businessman.

The Nasdaq composite index shot 2.3 percent higher to 3,029.63 Wednesday, powered by Apple shares. The iPhone maker's stock climbed $50 after the company again blew past Wall Street's profit forecasts. With Apple's help, the technology-focused Nasdaq posted its best day this year.

The Dow Jones industrial average closed up 0.7 percent to 13,090.72. The S&P 500 rose 1.4 percent to 1,390.69.

Benchmark oil for June delivery was up 13 cents to USD 103.99 per barrel in electronic trading on the New York Mercantile Exchange. The contract added 57 cents to end at USD 104.12 per barrel in New York on Wednesday.

In currencies, the dollar fell to 81.18 yen from 81.29 yen amid the Fed's tepid assessment of the US economy. The euro fell to USD 1.3229 from USD 1.3230.

Bureau Report

First Published: Thursday, April 26, 2012 - 09:38
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