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Asian Markets In The Green On Powell’s Comments

Asian stock markets are trading in the green on Monday, following the broadly positive cues from Wall Street on Friday, reacting to U.S. Federal Reserve Chairman Jerome Powell’s remarks at the Jackson Hole symposium on Friday. However, the upside is limited as traders remain anxious amid the coronavirus situation in the region and in several countries, which continues to stifle economic activity. Asian markets closed mixed on Friday.

Powell said the central bank is likely to begin tapering some of its easy-money policies before the end of the year, but added that the bank is unlikely to hike interest rates anytime soon. He added that the economy has reached a point where it no longer needs as much policy support, but felt there’s “much ground to cover” before rate hikes.

The Australian stock market is slightly higher on Monday, recouping some of the losses in the previous two sessions, with the benchmark S&P/ASX 200 just below the 7,500 level, following the broadly positive cues from Wall Street on Friday on upbeat comments by Fed Chairman Jerome Powell and firm commodity prices that drove materials, energy and mining stocks higher.

However, traders remain concerned as the country struggles to contain the domestic coronavirus situation, primarily in New South Wales and Victoria, with states and territories going in for tighter restrictions and lockdowns.

NSW reported a record 1,218 new cases on Sunday. Victoria also recorded 73 new locally acquired cases, with the total active cases of COVID-19 across Victoria standing at 805.

The benchmark S&P/ASX 200 Index is gaining 9.80 points or 0.13 percent to 7,498.10, after touching a high of 7,528.30 and a low of 7,476.00 earlier. The broader All Ordinaries Index is up 20.80 points or 0.27 percent to 7,780.90. Australian stocks closed marginally lower on Friday.

Among the major miners, BHP Group, Rio Tinto and OZ Minerals are gaining almost 3 percent each, while Fortescue Metals is adding more than 6 percent and Mineral Resources is up more than 4 percent.

Fortescue Metals has doubled its final dividend to $2.11 after a record year of shipments sent profit surging.

Oil stocks are mostly higher, with Oil Search and Beach energy gaining almost 2 percent each, while Santos is adding almost 3 percent. Origin Energy is flat and Woodside Petroleum is edging down 0.3 percent.

Among tech stocks, Appen and WiseTech Global are losing almost 2 percent each, while Xero is down almost 1 percent. Afterpay is adding more than 1 percent.

Gold miners are higher. Evolution Mining is gaining more than 2 percent, while Newcrest Mining is adding more than 1 percent and Gold Road Resources is up more than 2 percent. Northern Star Resources is rising almost 4 percent and Resolute Mining is adding more than 3 percent. Among the big four banks, Commonwealth Bank and ANZ Banking are losing more than 1 percent each, while National Australia Bank and Westpac are declining almost 1 percent each. In the currency market, the Aussie dollar is trading at $0.730 on Monday.

The Japanese stock market is modestly higher on Monday, recouping the losses of the previous session, with the Nikkei 225 moving above the 27,700 level, following the broadly positive cues from Wall Street on Friday, even as traders continued to be concerned about the spread of the highly contagious coronavirus variants and the resultant expanded and extended state of emergencies.

The benchmark Nikkei 225 Index closed the morning session at 27,718.86, up 77.72 points or 0.28 percent, after touching a high of 27,921.55 earlier. Japanese shares ended modestly lower on Friday.

Market heavyweight SoftBank Group is losing almost 1 percent and Uniqlo operator Fast Retailing is down almost 2 percent. Among automakers, Honda is gaining more than 1 percent and Toyota is edging up 0.5 percent. In the tech space, Advantest is edging up 0.1 percent, Screen Holdings is gaining 1.5 percent and Tokyo Electron is adding almost 1 percent. In the banking sector, Sumitomo Mitsui Financial is edging up 0.1 percent, while Mizuho Financial is flat and Mitsubishi UFJ Financial is edging down 0.2 percent.

The major exporters are higher, with Panasonic gaining more than 1 percent, Mitsubishi Electric rising 1.5 percent and Canon adding almost 1 percent, while Sony is edging down 0.3 percent.

Among the other major gainers, Nippon Steel and JFE Holdings are gaining more than 4 percent each, while Kobe Steel, Dowa Holdings, Toho Zinc and Mitsui Chemicals are adding almost 4 percent each. Nichirei, Pacific Metals, Toyota Tsusho, Keio and Hino Motors are all up more than 3 percent each. Tokyu Fudosan, Taiyo Yuden and Marui Group are rising almost 3 percent each.

Conversely, M3 is losing almost 2 percent.

In the currency market, the U.S. dollar is trading in the higher 109 yen-range on Monday.

Elsewhere in Asia, Taiwan, Hong Kong, South Korea, China, New Zealand, Indonesia, Malaysia and Singapore are all higher by between 0.3 and 0.9 percent each. On Wall Street, stocks closed firmly in positive territory on Friday, reacting to Federal Reserve Chairman Jerome Powell’s remarks at the Jackson Hole symposium. The major averages all posted strong gains, with S&P and Nasdaq moving on to post fresh record closing highs.

The Dow ended the session with a gain of 242.68 points or 0.69 percent at 35,455.80, after climbing to a high of 35,479.18. The S&P 500 ended stronger by 39.37 points or 0.88 percent at 4,509.37, slightly off a new intra-day high of 4,513.22. The Nasdaq, which climbed to 15,144.48, settled at 15,129.50, gaining 183.69 points or 1.23 percent. The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 gained 0.32 percent, Germany’s DAX ended 0.37 percent up and France’s CAC 40 gained 0.24 percent. Crude oil futures settled sharply higher on Friday amid possible near-term disruptions in oil and natural gas operations in the Gulf of Mexico region due to the impact of Hurricane Ida. West Texas Intermediate Crude oil futures for October ended up by $1.32 or about 2% at $68.74 a barrel. 

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