Asian stocks tracked Wall Street higher on Tuesday ahead of a chorus of Federal Reserve officials due to speak later in the day, while the Australian dollar held steady and domestic shares rose ahead of the country’s interest rate decision.
Ebbing worries over political turmoil in Europe also added to the buoyant market mood and sent EUROSTOXX 50 futures 0.6% higher, reversing some of its steep losses from last week. FTSE futures similarly rose 0.43%.
The main market focus in Asian hours on Tuesday was on the Reserve Bank of Australia’s (RBA) policy decision, where expectations are for the central bank to stand pat on rates.
Focus, however, will be on any forward guidance for a potential easing cycle Down Under.
The Aussie was last 0.07% higher at $0.6617, while Australian shares (.AXJO), jumped 0.9%, in line with its regional peers.
“The RBA is universally expected to keep rates on hold today,” said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.
“Key domestic data (and) events since the May meeting have been mixed but err slightly firmer in our view – a firm April CPI print, further house price gains, more resilient household consumption, a still-tight labour market and expansionary budgets,” he said.
“Things are still a long way from prompting the RBA to signal a shift to a less restrictive policy stance.”
Elsewhere, MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), 0.68%, helped by an overnight rally on Wall Street.
“Optimism over a resilient economy, improving corporate earnings and the potential start of rate cuts has supported equities, defying concerns that the rally has been concentrated in just a few mega-cap tech stocks,” said Jameson Coombs, an economist at Westpac.
Japan’s Nikkei advanced 0.83%, while Hong Kong’s Hang Seng Index edged 0.14% higher. Chinese blue chips ticked up 0.17%.
Source: Reuters
Recent Comments