Asian Stocks Rise On Wall St. Lead, Hopes For Trump Tax Bonanza
- Asian markets rose on a day of light economic news
- Investors looked to Wall Street’s doughty lead and hopes for US corporate tax policy
- The Australian Dollar took a knock as consumer prices there missed forecasts
It may be your favourite currency, but who’s with you? Take a look at the DailyFX sentiment page
Risk appetite endured in Asia Wednesday. Stock markets were lifted by a strong Wall Street lead and hopes for some concrete business friendly tax policy plans from US President Donald Trump. Reports out of the US suggest that the President could unveil large cuts to both corporate income tax levels and to the levy on repatriated offshore earnings.
US equity soared on Tuesday thanks to solid showings from the likes of McDonald’s and Caterpillar. The Nasdaq topped 6,000 for the first time while the Dow surged more than 1%. With a lead like this Wednesday was always going to be Asia’s to lose but investors took the hint.
The Nikkei 225 ended up more than 1%, while Australian and South Korean shares also rose. Chinese stocks were in on the action too with gains for Shanghai, Shenzhen and Hong Kong.
In Asian currency markets the Yen continued to edge down as risk appetite continued to rise and those hopes for US tax cuts buoyed the Dollar. The Canadian Dollar got some respite after the hammering it took Tuesday on US softwood tariffs, but remains close to its February lows.
The Australian Dollar lost a bit of ground too as official Consumer Price Index numbers missed forecasts.
Crude oil prices resumed their downtrend thanks to news of another rise in US stocks, record supplies elsewhere and, reportedly, doubts about the effectiveness of production cuts. US benchmark crude fell about 12 cents, with Brent off about 11.
Gold remains as out of favor as most perceived haven assets in the aftermath of a market friendly outcome to last weekend's first round of the French presidential election. Gold prices touched a two-week low in Asian trade, even if they didn’t have to fall very far to do it. It has since pared losses. Tuesday saw the biggest one-day fall since early March.
The remainder of the global session offers a somewhat sparse global economic calendar populated with US mortgage application numbers, Canadian retail sales and oil inventory data from key industry waypoint Cushing Oklahoma.
--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter:@DavidCottleFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.