Asian stocks gain after Fed keep US interest rates low
BEIJING (AP) — Asian stocks advanced Thursday after the U.S. Federal Reserve left interest rates near zero to support a struggling economy.
Benchmarks in Shanghai, Hong Kong and Seoul gained. Tokyo was lower.
Lower interest rates and investor optimism about a possible coronavirus vaccine have helped global markets recover most of this year’s losses. But analysts say it might be too early to bet the recovery will persist, given the rising infection numbers in the United States, Brazil and other countries.
On Wednesday, Fed Chairman Jerome Powell warned that rising U.S. cases, which have led some state governments to reimpose anti-disease measures, threaten the modest recovery from the pandemic.
The Fed said it would keep buying $120 billion of Treasury and mortgage bonds every month to encourage borrowing and spending, but Powell said Congress needs to take action. Legislators have yet to agree on aid after $600 in weekly unemployment benefits for millions of Americans run out this week.
“The current situation is all about money in consumer pockets, which is precisely why fiscal policy is so much more important," Stephen Innes of AxiTrader Corp. said in a report.
The Shanghai Composite Index rose 0.1% to 3,297.57 while the Nikkei 225 in Tokyo gave up 0.1 to 22,367.74.
The Hang Seng in Hong Kong gained 1% to 25,143.60 despite data showing the territory's economy shrank by 9% in the quarter ending in June.
The Kospi in Seoul advanced 0.3% to 2,270.65 and Sydney's S&P-ASX 200 added 0.7% to 6,050.80. India's Sensex opened up 0.7% at 38,349.93. New Zealand and Jakarta advanced while Singapore and Bangkok retreated.
On Wednesday, the benchmark S&P 500 index rose 1.2% to 3,258.44 in its biggest daily increase in two weeks. The S&P 500, which was down 34%...
