Asian stocks follow Wall Street higher ahead of Fed meeting

  • 3/15/2021
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TOKYO/NEW YORK (Reuters) - Asian stocks rose on Tuesday, tracking an advance by Wall Street’s main indexes to record highs, as investors looked to key central bank meetings this week, starting with the U.S. Federal Reserve. An index of the region’s share markets excluding Japan strengthened 0.7%, led by a 1.2% jump in Australia’s benchmark S&P/ASX 200 index. Japan’s Nikkei 225 gained 0.6% to just below the closely watched 30,000 mark, while the broader Topix added 0.5%. China’s blue chip CSI 300 index climbed 0.7%, and Hong Kong’s Hang Seng gained 0.7%. On Monday, the S&P 500 and Dow Jones Industrial Average both soared on gains in travel stocks as mass vaccinations in the United States and congressional approval of a $1.9 trillion aid bill fueled investor optimism. E-mini futures for the S&P 500 edged up 0.06%. Investors are focused on the Fed’s two-day policy meeting, which will conclude on Wednesday, as bond yields have surged this year on investors betting central bankers will need to raise rates sooner than they have so far signaled to contain inflation. Fed policymakers are expected to forecast that the U.S. economy will grow in 2021 by the fastest rate in decades. The Bank of England also meets this week on Thursday, while the Bank of Japan wraps up a two-day gathering on Friday. “Markets are likely to be in a holding pattern ahead of this...heavy central bank-laden week,” write analysts at TD Securities. On Wall Street, the Dow Jones Industrial Average rose 174.82 points, or 0.53%, to 32,953.46, the S&P 500 gained 25.6 points, or 0.65%, to 3,968.94 and the Nasdaq Composite added 139.84 points, or 1.05%, to 13,459.71. Airline shares rose as the companies pointed to concrete signs of an industry recovery as vaccine rollouts help spur leisure bookings. Germany, France and Italy hit pause on AstraZeneca COVID-19 shots after several countries reported possible serious side effects. The development will be watched in Australia, where the vaccine is also administered. The pan-European STOXX 600 index was flat on Monday, after touching its highest level since February 2020. Longer-term U.S. Treasury yields slipped further on Tuesday, as the market looked ahead to the Fed meeting and the latest government debt auctions. The benchmark 10-year yield, which reached a more than one-year high of 1.642% last week, was back at 1.595% Rising inflation expectations could prompt the Federal Open Market Committee to signal it will start raising rates sooner than expected. In currencies, the U.S. dollar held small gains from overnight in muted price action ahead of the central bank meetings. The greenback was largely flat at 109.165 yen, after rising as high as 109.365 on Monday for the first time since June. The euro was little changed at $1.19320, languishing for an eighth session below the closely watched $1.20 level. Bitcoin continued its slide from a record high of $61,781.83 reached on Saturday, last trading 3% weaker on the day at around $53,915. U.S. West Texas Intermediate crude for April changed hands at $64.79 a barrel, down 60 cents. Brent crude futures for May stood at $68.21 a barrel, losing 67 cents.

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