Thursday’s share of Asia is Federal Reserve signaled Later this year, we may begin to ease special support measures for the economy.
Stocks rose in Hong Kong, Shanghai, Australia and Taiwan, but fell in South Korea and Malaysia. US futures were higher. The market has closed in Tokyo.
The US central bank has indicated that it may start raising benchmark rates by the end of next year, earlier than expected three months ago. He added that if the economy continues to improve, it is likely that it will begin to slow down the pace of monthly bond purchases “immediately.” The Fed buys bonds throughout the pandemic to keep long-term interest rates low.
The market was reassured after Evergrande, one of China’s largest private real estate developers. He said he was planning to pay on Thursday. This may have eased concerns about Chinese real estate developers with large debts and the potential spillover effects of possible defaults.
In Hong Kong, the Hang Seng Index rose 2% to 24,745.96. The Shanghai Composite Index was up 0.6% to 3,651.27. Australia’s S & P / ASX 200 surged 1% to 7,368.40. South Korea’s Kospi fell 0.7% to 3,117.99.
On Wall Street, the S & P 500 rose 1%, defeating four consecutive days of losing streak. The Benchmark Index initially rose 1.4% after the Federal Reserve Board issued a statement at 2:00 pm Eastern Standard Time.
Other major indices also surged, but lost some of the rise by late afternoon. The Dow Jones Industrial Average rose 1% to 34,258.32. The Good Equity Index temporarily rose 520 points. The Nasdaq Composite Index rose 1% to 14,896.85.
Bond yields have risen primarily. After the announcement by the Federal Reserve Board, yields on 10-year government bonds fluctuated up and down, but remained stable at 1.31%. Yields affect interest rates on mortgages and other consumer loans.
According to analysts, the Fed’s policy update was in line with what the market expected. VIX, a measure of volatility investors expect from the S & P 500, fell about 14% after the Fed’s statement.
Brian Jacobsen, Senior Investment Strategist at Wells Fargo Asset Management, said:
At a press conference, Federal Reserve Board Chair Jerome Powell said the Fed will begin curtailing monthly bond purchases as early as November if the job market continues to improve steadily. rice field.
Gene Goldman, chief investment officer of Cetera Financial Group, revealed that the Fed’s shift has begun to raise concerns about inflation.
“Our concern is that the Fed continues to stick to the view that this is a temporary stage, but there is no evidence that this is a temporary stage,” he said.
Goldman added that a wider range of markets could be subject to revision as economic growth slows and inflation continues to rise. “Our concern about the overall economy and market is that number one. We are at all peaks,” he said.
September was a tough month for stocks. S & P 500 is down 2.8%.
Aside from concerns about the potential Fed policy shift, investors are worried about the rise in COVID-19 cases due to the impact of highly contagious delta mutations and rising inflation on businesses and consumers. I am.
History does not provide a good guide on how the market reacts to the Fed’s easing of support for the economy. This is mainly because it was a very rare event.
In the summer of 2013, Treasury yields skyrocketed after the Fed chair suggested that bond buying programs could begin slowing. Surprised investors assumed that rate hikes would continue quickly, pushing up the Treasury yield from less than 2.20% to 3% within three months.
However, after the Fed announced in December that it would cut back on purchases, the 10-year yield made a U-turn, despite the Fed’s reduced support for programs aimed at keeping interest rates low.
Stock prices were relatively stable despite the turmoil in the bond market.
The 10-year yield has fallen from 1.70% in March and has been relatively stable between 1.20% and 1.30% since July. Powell has repeatedly emphasized how slow the Fed will move from declining bond purchases to raising interest rates.
On Wednesday, more than 80% of shares in the S & P 500 Index rose. This is primarily due to technology stocks, banks and businesses that rely on direct consumer spending. Energy stocks recorded a solid rise as US crude oil prices rose 2.4%. The inventory of communications and utilities has decreased.
Small stocks worked better than the wider market. The Russell 2000 Index rose 1.5% to 2,218.56.
Netflix rose 3.1% after streaming entertainment services Acquired Roald Dahl’s work, The late British writer of famous children’s books such as “Charlie and the Chocolate Factory”.
Facebook fell 4% after telling blog posts that social networks underreported web conversions by Apple mobile device users by about 15% following changes in Apple’s operating system.
FedEx plunged 9.1%, the largest decline in S & P 500 shares. Significantly high costs reported Even if the demand for transportation increases. Many industries are fighting higher costs due to a mix of labor and supply chain issues.
In another trade on Thursday, US benchmark crude fell 7 cents per barrel to $ 72.16 in electronic trading on the New York Mercantile Exchange. It rose from $ 1.74 to $ 72.23 per barrel on Wednesday.
Brent crude, the international standard, fell 8 cents per barrel to $ 75.31.
The US dollar rose from 109.76 yen to 109.86 yen. The euro fell from $ 1.1691 to $ 1.1688.
Contributed by AP business writers Alex Veiga, Stan Choe and Damian J. Troise.
Copyright 2021 AP communication. all rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Asian Equity, Wall Street Holds Profit After Federal Reserve Board Statement | Associated Press |
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