Asian stocks mixed after Yellen's remarks on rate hike

AP News
Posted: Nov 04, 2015 10:54 PM
Asian stocks mixed after Yellen's remarks on rate hike

SEOUL, South Korea (AP) — Asian stock markets were mixed Thursday after remarks by the Federal Reserve chair renewed expectations that the Fed's first rate hike in nearly a decade could take place as early as next month.

KEEPING SCORE: Tokyo and Shanghai stocks were higher in the morning but other markets traded in the negative territory. Japan's Nikkei 225 rose 1 percent to 19,122.42 and Shanghai Composite index gained 1.5 percent to 3,510.71. South Korea's Kospi dropped 0.4 percent to 2,044.94 while Hong Kong's Hang Seng index inched down less than 0.1 percent to 23,048.83. Australia's S&P/ASX 200 fell 1 percent to 5,189.20. Stocks in Taiwan, Singapore and other Southeast Asia were lower.

FED WATCH: Testifying before the House Financial Services Committee, Federal Reserve Chair Janet Yellen described the U.S. economy as "performing well" right now and an interest rate hike in December is a "live possibility" if the economy stays on track. Her view was echoed by another Fed policymaker later in the day. Yellen did stress that no decision has been made yet and a move in December will depend on how the economy fares between now and then.

ANALYST'S TAKE: "Even with weak data, Fed rhetoric increasingly points toward a December lift-off," DBS Group Research said in a daily commentary. The report said it was only a week ago when markets lowered the odds of a December rate hike due to poor data. "Markets have had to adjust expectations rapidly."

WALL STREET: In the U.S., stocks retreated modestly Wednesday. The Dow Jones industrial average lost 0.3 percent to 17,867.58. The Standard & Poor's 500 index fell 0.4 percent to 2,102.31 and the Nasdaq composite 0.1 percent to 5,142.48.

OIL: Benchmark U.S. crude futures rebounded, adding 19 cents to $46.51 per barrel in electronic trading on the New York Mercantile Exchange. The contract slumped $1.58, or 3.3 percent, to close at $46.32 a barrel on Wednesday as Yellen's comments pushed up the dollar. Brent crude, which is used to price international oils, gained 25 cents to $48.84 a barrel.

CURRENCIES: The U.S. dollar halted its appreciation against the major global currencies. The euro rose 0.1 percent to $1.0871 from $1.0866 while the dollar fell to 121.49 yen from 121.51 yen.