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GLOBAL MARKETS-Asia shares set to follow Wall Street's modest gains after Fed maintains stance

Published 2021-04-07, 07:58 p/m
© Reuters.

By Chibuike Oguh

April 7 (Reuters) - Asian equities are poised to track Wall Street's cautious gains on Thursday after minutes from the Federal Reserve's latest meeting reiterated its commitment to keep interest rates low until the U.S. economy makes a more secure recovery.

The S&P 500 and Dow closed slightly higher on Wednesday, as the Fed's commentary reinforced investor expectations that the central bank plans to maintain its policy support despite massive fiscal spending from the recent government stimulus package.

"Investors remain intensely focused on interest rates," said Jeff Buchbinder, equity strategist at LPL Financial in Boston. "We in the market didn't expect any signals of a change in policy and that's what we got."

Australian S&P/ASX 200 futures YAPcm1 rose 0.52% in early trading, while {{178|Japan's NiNikkei 225 futures NKc1 added 0.03%.

U.S. Federal Reserve officials expressed caution about ongoing risks of the pandemic and reaffirmed their commitment to bolstering the economy given "that the path ahead remained highly uncertain," the minutes from the March 16-17 meeting said. yield on the benchmark 10-year U.S. Treasury note 10USYT=RR moved higher late in the session, yet remained below a 14-month high of 1.776% hit on March 30. The recent pullback in yields has helped growth names and lifted technology .SPLRCT and communication services .SPLRCL stocks as the best performing sectors on the day. 10-year yield didn't move much today and the rate seems to be settling in to a little bit lower range that really coincides with the better performance for the growth stocks, particularly tech," Buchbinder said.

On Wall Street, the Dow Jones Industrial Average .DJI rose 0.05% to 33,446.26, the S&P 500 .SPX gained 0.15% to 4,079.95 and the Nasdaq Composite .IXIC dropped 0.07% to 13,688.84.

Following the release of the Fed minutes, the benchmark 10-year notes US10YT=RR last fell 4/32 in price to yield 1.6686%, down from 1.656% late on Tuesday. already seen long-term 10-year rates jump up and with the Fed telling us they are not going to move so interest rates could stay at the lows that they are until maybe 2022 when they step in," said Jeff Carbone, managing partner at Cornerstone Wealth Group in Charlotte.

The U.S. dollar advanced against a basket of world currencies after oscillating for much of the session, rising in the wake of the Fed minutes release. dollar index =USD rose 0.148%, with the euro EUR= down 0.02% to $1.1868. The Japanese yen was flat versus the greenback at 109.85 per dollar, while the Korean won strengthened 0.03% versus the greenback at 1,118.71 per dollar.

Gold prices dipped as economic optimism drew investors away from the safe-haven metal in favor of riskier assets. gold XAU= dropped 0.4% to $1,737.11 an ounce. U.S. gold futures GCv1 settled 0.1% lower at $1,741.6.

Crude oil prices rose on an improving global economic outlook, but were held in check by rising gasoline inventories. crude CLcv1 settled at $59.77 per barrel, up 0.74%, while Brent LCOcv1 gained 0.67% to settle at $63.16 per barrel.

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