Asia-Pacific markets rise sharply as Fed holds rates and may change plot; Electric vehicle shares rise despite EU tariffs

The sails of the Opera House are illuminated with projections on the opening night of Vivid Sydney 2023 in Sydney, Australia, Friday, May 26, 2023.

Anadolu Agency | Anadolu Agency | Getty Images

Asia-Pacific markets were mostly higher on Thursday after the US Federal Reserve kept the federal funds rate at 5.25% at 5.5% and moved the “dotted plot” to predict just one rate cut this year.

That was the least of the three cuts predicted at the March meeting. However, the dot chart also showed a more aggressive cut path for 2025, forecasting four rate cuts amounting to a full percentage point, down from three.

In Asia-Pacific, in South Korea Kospi Gains led the way, gaining 0.98% to close at 2,754.89. The index posted a third straight day of gains, while small-cap Kosdaq rose slightly to 871.33.

Hong Kong Hang Seng Index rose 0.87%, supported by gains in electric vehicle stocks, despite the European Union imposing tariffs of up to 38% on Chinese electric vehicle makers.

EV Company BYD was the top gainer on the HSI, rising over 6%, while peers Nothing AND That car saw their shares rise by 1.16% and 1.85% respectively.

Mainland China’s CSI 300 also reversed earlier gains, losing 0.51% and hitting its lowest level in nearly two months.

of Japan Nikkei 225 reversed earlier gains to fall 0.4% to 38,720.47, while the broad-based Topix was 0.89% lower to end at 2,731.78

Australia’s S&P/ASX 200 rose 0.44% to close at 7,749.7, recovering from two days of losses.

Statements after the Fed meeting said “inflation has moderated over the past year but remains elevated,” echoing language from the last statement.

However, the new statement also said: “In recent months, there has been modest further progress towards the Committee’s 2 percent inflation target.”

The previous language said there was a “lack of further progress” on inflation.

Separately, inflation in May remained unchanged from April, increasing by 3.3% year-on-year and remaining unchanged on a monthly basis.

Overnight in the US, all three major indexes rose in response to the Fed decision and May’s inflation reading.

The S&P 500 jumped to a record high and closed above 5,400 for the first time.

The broader market index rose 0.85% to close at 5,421.03, while the Nasdaq Composite also gained 1.53% to hit a record high. In contrast, the Dow Jones Industrial Average fell 0.09%.

CNBC’s Lisa Kailai Han, Pia Singh and Jeff Cox contributed to this report.

#AsiaPacific #markets #rise #sharply #Fed #holds #rates #change #plot #Electric #vehicle #shares #rise #tariffs
Image Source : www.cnbc.com

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top