Asian Stock Market: Indices rebound on positive Wall Street, PBOC maintains status quo
|- Asian stocks have rebounded after tracking positive cues from Wall Street.
- Chinese indices have secured gains despite an unchanged PBOC policy.
- Oil prices have recaptured the hurdle of $85.00 ahead of Fed policy.
Markets in the Asian domain have rebounded sharply after plummeting on Monday. Asian indices are following the cues from Wall Street and are trading in the positive territory ahead of the interest rate decision by the Federal Reserve (Fed). Investors have shrugged off the clouds of uncertainty over the Fed meeting as a rate hike is expected, however, the extent could accelerate further.
At the press time, Japan’s Nikkei225 and ChinaA50 added 0.43% while Hang Sang jumped 1.37%.
Chinese equities are holding gains despite the maintenance of the status quo by the People’s Bank of China (PBOC). The central bank has kept its one-year and five-year Prime Lending Rate (PLR) unchanged. A rate cut was expected by the market participants as the economy is strict on its path of spurting the growth rate. Also, China’s inflation rate slipped in August, which bolstered the expectations of a dovish stance.
Meanwhile, Japan’s Ministry of Finance (MOF) has promised additional spending of 3.48 trillion yen in budget reserves to cope with price hikes and covid-19, news wires from Reuters. An improvement in price pressures will surely delight the Bank of Japan (BOJ) as the central bank is facing the headwinds of prolonged depreciation in the domestic currency.
On the oil front, oil prices have recaptured the critical resistance of $85.00 despite soaring odds of a bumper rate hike by the Federal Reserve (Fed). Squeezing liquidity from the economy will have a significant impact on oil demand. In spite of this fact, investors are pouring funds into black gold.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.