Stocks around Asia were mostly higher on Wednesday as US President Trump addressed US Congress for the first time, striking a slightly more optimistic tone than in recent speeches but with little additional clarity on his administration’ economic policies.
The US dollar swung into focus as William Dudley, head of the New York Federal Reserve, said in an interview with CNN the prospects for adding to December’s rate rise had become “a lot more compelling”. The chance of a 25 basis point rate rise in March climbed to 52 per cent compared to 36 per cent a week ago.
The dollar index received an early boost, up as much as 0.5 per cent at the start of the Asian session on Wednesday, but ceded ground to be 0.2 per cent higher as President Trump began his address to Congress.
On Monday, Robert Kaplan, president of the Dallas Fed, also added the chorus of policymakers floating the idea of tighter monetary policy, saying the US central bank may need to raise interest rates “sooner rather than later”.
Japan’s Topix was up 0.4 per cent while Hong Kong’s Hang Seng gained 0.2 per cent. The energy and telecommunications sectors led Australia’s S&P/ASX 200 0.4 per cent lower.
China’s Shanghai Composite added 0.6 per cent. Although not known for its sensitivity to economic data, two separate surveys had shown China’s manufacturing sector reporting continued improvement in February.
The Australian dollar surged after data showed gross domestic product rebounded in the December quarter, helping the country avoid what could have been its first recession in 25 years.
After some initial trepidation following the release, the Aussie dollar was up 0.4 per cent at $0.7687, making it the best-performing Asian currency today.
The Japanese yen trimmed early declines to be 0.2 per cent weaker at ¥113.02 per dollar.
Oil prices rebounded on Wednesday following three days of decline. Brent crude, the international benchmark, was up 0.2 per cent at $56.64 while West Texas Intermediate gained 0.2 per cent to $54.10.
Gold was down fractionally at $1,247.93 an ounce.