SYDNEY (Bloomberg) - Asian stocks rose, following a rebound in U.S. shares, after an unexpected drop in American retail sales strengthened the case for keeping interest rates lower for longer in the world's largest economy.
The MSCI Asia Pacific Index advanced 0.1 per cent to 144 as of 9:01 a.m. in Tokyo, paring this week's decline to 1 per cent. Rate bets were tempered Thursday after retail sales slipped for a third straight month. The Standard & Poor's 500 Index jumped 1.3 per cent after faltering earlier this week as a better-than- forecast U.S. jobs report raised concern the Federal Reserve will increase rates sooner than some expected.
U.S. retail sales data "provide the Fed with a well- rounded view of the prospects for the U.S. economy and may prompt a desire to wait until fresh data is released which is not impacted by distortions," said Matthew Sherwood, the Sydney-based head of investment markets research at Perpetual Ltd., which manages about US$21 billion. "There's better value and opportunity in other parts of the global share market."
Japan's Topix index added 0.3 per cent. South Korea's Kospi index advanced 0.9 per cent and Australia's S&P/ASX 200 Index slid 0.3 per cent. New Zealand's NZX 50 Index gained 0.3 per cent.
Futures on the Standard & Poor's 500 Index added 0.1 per cent. U.S. retail sales dropped 0.6 per cent in February from the previous month. Economists surveyed by Bloomberg had expected a 0.3 per cent gain.
Fed funds futures put the odds of a U.S. rate increase in September at 53 per cent on Thursday, down from 56 per cent on Wednesday, though still above the 49 per cent priced in March 5, the day before the February payrolls report.
Futures contracts on Hong Kong's Hang Seng Index rose 0.3 per cent, while contracts on the Hang Seng China Enterprises Index of mainland firms listed in the city advanced 0.5 per cent. Singapore-traded futures on the FTSE China A50 Index climbed 0.6 per cent.