Asian Shares Surge After Wall Street Gains

Bangkok, Dec 28 (AP) Asian shares powered higher on Thursday, with Chinese benchmarks up more than 1 per cent, after Wall Street logged modest gains in this holiday-shortened week.

US futures edged higher and oil prices were mixed.

Tokyo's Nikkei 225 index was an outlier in the region, shedding 0.5 per cent to 33,519.61. Speculation over whether and when the Bank of Japan might ease its longstanding lax monetary policy and raise its key interest rate from minus 0.1 per cent has kept stocks wobbling in the world's third-largest economy.

BOJ policymakers are waiting to see what sort of wage gains might come in 2024 as part of the central bank's strategy of keeping credit easy to try to spur stronger growth.

In Hong Kong, the Hang Seng index gained 1.5 per cent to 16,876.69 on heavy buying of technology and property shares. It has lost about 14 per cent this year as China's economy has sputtered despite the country's reopening after it loosened COVID-19 precautions.

Online food delivery company Meituan was up 4.3 per cent and property developer Sino-Ocean Group Holding was up 3.5 per cent.

The Shanghai Composite index surged 1.1 per cent to 2,947.01.

South Korea's Kospi advanced 0.9 per cent to 2,638.04 and the SandP/ASX 200 in Australia rose 0.5 per cent to 7,600.50.

India's Sensex gained 0.4 per cent and Bangkok's SET was up 0.3 per cent.

On Wednesday, the SandP 500 rose 0.1 per cent to 4,781.58. It is up 24 per cent for the year. The Dow Jones Industrial Average rose 0.3 per cent, to close at 37,656.52.

The technology-heavy Nasdaq composite rose 0.2 per cent to 15,099.18. It has outpaced other major indexes with a gain of 44 per cent this year.

Trading was subdued with two trading days left in the year. The SandP 500 is coming of its eight straight winning week and is hovering just below its all-time high set in January of 2022.

Bond yields fell significantly. The yield on the 10-year Treasury, which influences mortgage rates, fell was at 3.81 per cent early Thursday, down from 3.90 per cent late Tuesday. Yields have been falling over hopes that inflation has cooled enough for the Federal Reserve to consider cutting interest rates in 2024.

Several biotechnology companies made big moves after giving investors updates on drug development. Cytokinetics surged 82.5 per cent on an encouraging study update for a potential heart condition treatment. Iovance Biotherapeutics shed 18.7 per cent after pausing a study on a potential lung cancer treatment because of a possible safety issue.

The New York Times rose 2.8 per cent after filing a federal lawsuit against OpenAI and Microsoft over copyright infringement, seeking to end the practice of using its stories without permission to train chatbots.

The final week of 2023 lacks any big US economic updates. Overall, investors have been encouraged by reports showing inflation is on the decline even as the economy appears stronger than expected. The Fed is walking a tightrope, seeking to slow the economy enough through high interest rates to cool inflation, but not so much that it tips the nation into recession.

Inflation slowed to a rate of 2.6 per cent in November, according to a measure closely followed by the Fed. That's down from 7.1 per cent in the middle of 2022 and edging closer to the central bank's target of 2 per cent inflation. US economic growth has been steady since contracting in the middle of 2022 and sharply accelerated in the third quarter of 2023.

The data have raised hopes that the economy will likely avoid a recession, or at least avoid a significant one. They have also encouraged Wall Street to bet that the Fed is done raising interest rates and will likely shift to rate cuts in the new year. The central bank has held rates steady since its meeting in July, and Wall Street expects it to start cutting rates as early as March.

In other trading Thursday, US benchmark crude oil shed 7 cents to USD 74.04 per barrel in electronic trading on the New York Mercantile Exchange. It declined by USD 1.46 on Wednesday.

Brent crude, the international standard, was unchanged at USD 79.54 per barrel.

The US dollar fell to 141.30 Japanese Yen from 141.84 Yen. Expectations for a change to the BOJ's stance have given the Yen renewed strength, while hopes for an easing to US interest rates have weakened the dollar.

The Euro rose to USD 1.1113 from USD 1.1106.