SINGAPORE – Strong hints that United States interest rate cuts are on the horizon in 2024 turbocharged Wall Street overnight and gave most regional markets a welcome jolt as well.
US shares were going sideways for much of the session until news that the Federal Reserve had unanimously voted to keep rates steady, with easing possible in 2024.
That sent the S&P 500 and tech-heavy Nasdaq surging 1.4 per cent, while the Dow Jones Industrial Average rose 1.4 per cent to 37,090, a record high and the first time it breached 37,000.
It was a bit calmer here, with the benchmark Straits Times Index (STI) rising 0.6 per cent, or 18.69 points, to 3,122.95, with gainers beating losers 385 to 211 on trade of 1.6 billion shares worth $1.5 billion.
Regional markets mostly rose in reaction to the Fed’s more dovish signals. Hong Kong’s Hang Seng rose 1.1 per cent, South Korea’s Kospi shot up 1.3 per cent, Bursa Malaysia added 0.6 per cent and the ASX 200 in Sydney surged 1.7 per cent to an 18-week high.
Japan’s Nikkei 225 went the opposite way, falling 0.7 per cent.
The STI’s top constituent was real estate investment trust CapitaLand Ascendas Reit, which advanced 5.3 per cent to $2.99.
Other Reits also led gains in the index on hopes of cheaper borrowing costs. Mapletree Industrial Trust shot up 5.2 per cent, Mapletree Pan Asia Commercial Trust climbed 4.9 per cent, while CapitaLand Integrated Commercial Trust advanced 4.7 per cent.
Among local banks, DBS fell 1.3 per cent to $31.40, while OCBC lost 0.3 per cent to $12.47. UOB ticked up 0.1 per cent to $27.79.
Mr Vishnu Varathan, Mizuho Bank’s Asia head of economics and strategy, noted that US Treasury yields and the US dollar “went soft” after markets believed the Fed hawks were turning dovish. THE BUSINESS TIMES
