Asian shares looked set to rise on Wednesday, tracking gains seen on Wall Street amid earnings season news and following upbeat remarks from Federal Reserve Chairman Jerome Powell during his congressional testimony.
Futures tipped higher opens in Japan and Australia. Nikkei shares traded in Chicago were up 0.83 percent compared to the benchmark’s Tuesday close and Australian SPI futures were higher by 0.36 percent at the end of the last session.
The Fed’s Powell gave a positive assessment of the U.S. economy during his semiannual congressional testimony on Tuesday, indicating that gradual interest rate increases were warranted.
Powell also touched on the matter of trade disputes between the U.S. and its trading partners, saying it was “difficult to predict” the implications of those on the economy.
“So the key take away is that trade policy has not yet affected the Fed’s intentions for further gradual hikes. The Fed remains data dependent and the inclusion of the phrase ‘for now’ provides the bank with some flexibility if it needs to alter the interest rate path ahead,” Rodrigo Catril, senior FX strategist at National Australia Bank, wrote in a note.
U.S. stocks rose as earnings season rolled on stateside.
The tech-heavy Nasdaq composite notched a record high on Tuesday before closing up 0.63 percent to 7,855.12 and outperforming other U.S. indexes overnight. The Dow Jones Industrial Average rose 0.22 percent, or 55.53 points, to close at 25,119.89, the S&P 500 advanced 0.4 percent to 2,809.55.
In the tech sector, Netflix shares closed down by more than 5 percent after missing subscriber growth projections, after dropping by around 14 percent during the New York session. Of note, shares of Amazon touched an all-time high on a report that reflected robust Prime Day sales.
The dollar firmed following Powell’s comments, with the dollar index, which tracks the greenback against a basket of currencies, strengthening to last stand at 94.945 after two sessions of declines. Against the yen, the dollar traded at 112.94 at 7:01 a.m. HK/SIN.
Meanwhile, oil prices were steady for the most part after dropping more than 4 percent earlier this week. U.S. crude futures inched higher by 2 cents at $68.08 per barrel and Brent crude futures added 32 cents to $72.16.
