Higher rates also can cause property prices to decline. Energy and metals prices are rising as the dollar gets a bit weaker. Asia’s strong gains follow a surge of 1.1 percent for the S&P 500 .spx , 0.9 percent for the Dow Jones industrial average .dji and 1.3 percent for the Nasdaq Composite .ixic , which closed at a record high.
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But a high New Zealand dollar and tepid inflation – running at just 0.4 percent versus a target of 1 percent to 3 percent – gave the RBNZ reason to predict more easing to come.
In commodity markets, gold traded at $1,332.36 an ounce XAU=, having climbed 1.6 percent as the USA dollar declined.
The Fed will announce its policy decision at 2 p.m. EST (1800 GMT).
The Australian stock market is extending gains on Thursday from the previous session, following the positive cues overnight from Wall Street after the Federal Reserve kept interest rates unchanged and hinted that a rate hike is likely before the end of the year. “Overall, while the statement and dissents were more hawkish than expected, the dovishness contained in the SEP (Summary of Economic Projections) appear to be driving markets”, said Royce Mendes, director and senior economist at CIBC Capital Markets in Toronto, adding that the bank expects a rate hike in December.
A divided Federal Reserve left its benchmark interest rate unchanged on Wednesday, pressing ahead with its economic stimulus campaign for at least a few more weeks in the face of growing pressure to raise rates. Not included: Sweden, Denmark and Switzerland – nations where benchmark rates also begin with minus signs nowadays.
Three of her colleagues on the Fed dissented from the decision to hold rates steady.
USA crude futures jumped 2.5 percent to $45.12 a barrel, while Brent crude futures were up 1.8 percent at $46.72. The US Energy Information Administration (EIA) said crude inventories fell 6.2 million barrels last week, versus a 3.4 million-barrel build forecast in a Reuters poll.
US equities rallied after the decision, with the three major indexes closing about 1 percent higher.
Among oil stocks, Oil Search is adding more than 1 percent, Santos is advancing nearly 3 percent and Woodside Petroleum is up nearly 2 percent as crude oil prices surged overnight.
BONDS: Bond prices changed course and moved higher. The BoJ scrapped its monetary base target and vowed to pursue an overshoot of 2 percent inflation, maintain a zero percent 10-year JGB yield and support the yield curve.
ADOBE JUMPS: Software maker Adobe Systems climbed after it raised its forecasts for the year. Adobe also reported solid third-quarter results.
FLAT TIRE: CarMax lost $1.86, or 3.3 percent, to $53.95 after the used auto dealership reported weaker than expected sales. In prepared testimony, Bresch defended the company’s tactics and said Mylan balanced the price of EpiPen against access for patients. The contract added 69 cents on Wednesday to close at $45.34.
Drug companies, especially ones that make costly biotech products, have been hammered over the a year ago by repeated controversies over drug prices. Natural gas gained 1 cent to $3.06 per 1,000 cubic feet.
BANK OF JAPAN: The Japanese central bank said it will hold its short-term policy rate at negative 0.1 percent and might cut it further. They think policymakers want more time to evaluate the health of the USA economy, measure global risks and gauge whether inflation will soon reach the Fed’s 2 percent target rate. Some analysts thought the central bank would take further steps to bolster economic growth, which would have weakened the yen. The dollar edged up to 100.78 yen from 100.51 yen. While inflation remains low we expect it to rise toward the 2 percent objective over time. The euro gained to $1.1184 from $1.1190.
Gold rose $13.20, or 1 percent, to $1,331.40 an ounce.
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The value of Canadian wholesale trade rose in July for the fourth consecutive month, posting a 0.3 percent gain on strength in the motor vehicle and parts subsector, Statistics Canada said. Copper fell 1 cent to $2.16 a pound.
