Asian shares shoot higher after Fed verdict
On Thursday, Asian shares shot higher across the board, buoyed by the Fed’s decision to stick to the status quo and surging commodity prices.
In Hong Kong, the Hang Seng Index and Korean Kospi both gained 1%, while the S&P/ASX 200 ascended 0.8% and the Shanghai Composite Index tacked on 0.7%. In Japan, financial markets were closed for a public holiday.
Overnight, the Fed opted to hold its key short-term interest rate intact. Asia-based market participants appreciated the news as a rate surge would have pulled money out of emerging financial markets.
Fed officials also diminished their 2016 growth forecast for the American economy to about 1.8%, from June’s 2% projection, and lowered their long-term view on the growth rate from 2% to 1.8%.
Some traders in the market were caught off-guard by the sudden strength of the relief surge.
Elsewhere, crude and metals prices gained strongly on the back of a softer greenback, with the global Brent crude benchmark surging $0.50 to $47.32 a barrel, while copper as well as aluminum grew 0.5% and 0.4%, respectively.