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Asian Shares Mostly Higher After Fed Move

asian mixed 19sep19 lt

Asian stocks ended mostly higher on Thursday after the Federal Reserve cut interest rates for the second time this year but offered mixed signals about the outlook for rates.

The Bank of Japan, meanwhile, left its monetary policy unchanged as expected, despite growing risks to the country's fragile economic recovery.

Chinese shares ended on a positive note as investors waited to see whether China would lower its new lending reference rate on Friday following the Fed's rate cut and the easing by the European Central Bank.

Investors also looked ahead to a potential cooling of U.S.-China trade tensions, as the two sides gear up for talks. The benchmark Shanghai Composite Index gained 13.62 points, or 0.5 percent, to finish at 2,999.28, although Hong Kong's Hang Seng Index tumbled 285.17 points, or 1.1 percent, to 26,468.95.

Japanese shares advanced as the Bank of Japan kept its monetary policy unchanged and repeated that it would not hesitate to take additional easing measures if needed.

The central bank said it would reexamine economic and price developments at the next monetary policy meeting in October, when it updates the outlook for economic activity and prices.

The Nikkei 225 Index rose 83.74 points, or 0.4 percent, to 22,044.45, while the broader Topix ended 0.6 percent higher at 1,615.66.

Inpex rose 1 percent and Japan Petroleum rallied 2 percent as oil prices held steady in Asian trading after a two percent drop on Wednesday on data showing an increase in U.S. crude stockpiles last week. Exporters ended broadly lower as the yen rose from a seven-week low against the U.S. dollar.

Advantest, a leading manufacturer of automatic test equipment for the semiconductor industry, advanced 1.5 percent. Automaker Toyota shed 0.8 percent after announcing it will invest $391 million at its pickup truck assembly plant in San Antonio, Texas.

Australian markets finished higher as banks gained ground and energy stocks recouped losses from the previous session. The benchmark S&P/ASX 200 Index climbed 35.90 points, or 0.5 percent, to 6,717.50, while the broader All Ordinaries Index ended up 34 points, or 0.5 percent, at 6,825.20.

Banks ANZ, Commonwealth and NAB rose around half a percent each, while investment bank Macquarie Group rallied 2.4 percent. Oil and gas heavyweight Woodside Petroleum fell over 1 percent and Beach Energy declined 3.4 percent.

Mining stocks ended mixed as iron ore and copper prices declined. Gold miners Evolution and Newcrest dropped more than 1 percent after gold prices fell. Brickworks jumped 6.4 percent after the building products company raised its final dividend.

In economic news, Australia's budget returned to balance in the 2018-19 financial year for the first time since 2007-08, Federal Treasurer Josh Frydenberg said.

According to the Final Budget Outcome for the 2018-19 financial year, the budget deficit was A$13.8 billion better than estimated at the time of the 2018-19 Budget. The deficit of A$690 million represented 0.0 percent of gross domestic product.

Seoul stocks ended higher for the tenth straight day as Saudi Arabia's rapid recovery efforts helped ease concerns over oil supply and investors expressed hopes for progress in upcoming U.S.-China trade talks.

The benchmark Kospi rose 9.62 points, or 0.5 percent, to 2,080.35, with technology stocks leading the way higher. Samsung Electronics jumped 3 percent and SK Hynix added 3.1 percent.

New Zealand shares eked out modest gains, with the benchmark S&P/NZX 50 Index edging up 26.20 points, or 0.2 percent, to 10,801.05 after second quarter GDP data topped forecasts.

On an annualized basis, GDP climbed 2.1 percent in the second quarter of 2019 - beating forecasts for 2.0 percent but slowing from 2.5 percent in the three months prior, Statistics New Zealand data showed.

Fuel distributor Z Energy climbed 2.8 percent and stock exchange operator NZX advanced 1.6 percent.

Meanwhile, Indonesia's Jakarta Composite index fell 0.5 percent as the country's central bank announced its third rate cut in three months to stimulate flagging growth.

U.S. stocks ended narrowly mixed overnight as the Federal Reserve cut rates by another 25 basis points, as widely expected, but cast some doubt on the need for future stimulus.

"Jay Powell and the Federal Reserve Fail Again. No 'guts,' no sense, no vision! A terrible communicator!" President Trump tweeted shortly after the announcement.

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