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Europe, some Asia markets rise on Fed rate plans

Published June 19, 2014 10:10 am
This is an archived article that was published on sltrib.com in 2014, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Hong Kong • European and some Asian stock markets rallied Thursday after the Fed signaled that U.S. interest rates would remain at record lows.

Equity investors had been awaiting the Federal Reserve's economic updates and statements by Chair Janet Yellen, who made clear that although the world's largest economy was seeing a steadily improving job market and modest inflation, there was no need to raise short-term rates from record lows anytime soon.

In early European trading, France's CAC 40 rose 0.7 percent to 4,564.00, while Germany's DAX gained 0.7 percent to 10,003.00. The FTSE 100 index of leading British stocks added 0.7 percent to 6,824.03.

U.S. stocks were poised to open marginally higher as Dow futures edged up 0.1 percent to 16,828.00 and the broader S&P 500 futures rose 0.1 percent to 1,950.60.

"The Fed managed to navigate through what some had expected to be a potentially tricky announcement by providing further fuel for both equity and Treasury market bulls," strategists at Rabobank said in a report.

Stan Shamu, market strategist at IG Markets in Melbourne, said, "With inflation picking up and unemployment falling, many investors out there were beginning to feel perhaps the Fed might be looking to raise rates sooner."

Japan's benchmark Nikkei 225 jumped 1.6 percent to end at 15,361.16 as the dollar slipped to 101.77 yen from 101.91 in late trading Wednesday. Australia's S&P/ASX 200 also gained strongly, adding 1.6 percent to 5,468.20.

Hong Kong's Hang Seng was little changed at 23,167.73 while South Korea's Kospi edged up 0.1 percent to 1,992.03.

In mainland China, the Shanghai Composite Index lost 1.5 percent to 2,023.73.

In energy trading, benchmark crude oil for July delivery rose 31 cents to $106.28 in electronic trading on the New York Mercantile Exchange. The contract fell 39 cents to close at $105.97 on Wednesday.

The euro strengthened to $1.3637 from $1.3587 in late trading Wednesday.




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