HSI Raises As Asian Stocks Soar After Fed Move

Hong Kong shares pushed their recent rally into a fourth day on Thursday, ending the morning more than 1 percent higher after the Federal Reserve indicated it could cut interest rates as soon as next month.

The Hang Seng Index jumped just over 1 percent, to 28,486 by the break.

On the mainland, the Shanghai Composite Index soared 2.6 percent, to to 2,992, while the Shenzhen Composite Index dipped 2.2 per cent to 1,559.

Tokyo climbed 0.6 percent going into the break, Hong Kong rose 0.9 percent and Shanghai added 1.2 percent, with Sydney up 0.3 percent.

Singapore added 0.8 percent, while Taipei and Jakarta were also up, though Wellington and Manila were slightly lower.

The US dollar extended losses after a much-anticipated meeting, Fed boss Jerome Powell said officials felt the case for a rate reduction had "strengthened", citing the trade standoff with China and weak inflation, adding it would "act as appropriate" to support growth.

The bank also dropped the word "patient" in describing its assessment of economic data, fuelling speculation of a reduction as soon as July.

"The forward guidance from the Fed was no longer about being patient but being pragmatic," said Kerry Craig, global market strategist at JP Morgan Asset Management. "As inflation is taking longer to return to target and trade uncertainty is weighing on the global outlook, the Fed is singing a dovish tune."

He added that Powell "walked a fine line, highlighting a level of confidence in the US economy, even as growth is expected to slow and vulnerabilities from global politics increase", which was enough not to cause concern to traders.

The news hit the greenback, which fell across the board on foreign exchanges with the South African rand 1.6 percent higher, Canada's dollar rising 1 percent, South Korea's won up 0.5 percent and the Indonesian rupiah 0.3 percent stronger. (AFP)

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