Asian Stocks Up, Boosted by Fed Bond Buying Measures

This post was originally published on this site – Asian stocks were up on Tuesday morning, riding on the wave of an overnight surge in U.S. markets after the U.S. Federal Reserve announced additional measures to support the U.S. economic recovery from the COVID-19 virus.

The Fed said on Monday that the range of eligible assets for its bond buying program will now include all U.S. corporate bonds meeting certain criteria, and investors are waiting to see what Chair Jerome Powell’s semiannual policy report to Congress, to be delivered on Wednesday, will say.

“The size and the pace of Fed balance sheet expansion is something that will put a floor under global equity markets,” Stephen Gallo, BMO Capital Markets head of European FX strategy, told Bloomberg.

Japan’s Nikkei 225 gained 3.42% by 10:16 PM ET (3:16 AM GMT), with the Bank of Japan due to announce its policy decision later in the day.

South Korea’s KOSPI soared 4.25% and Down Under, the ASX 200 jumped 3.49%.

Hong Kong’s Hang Seng Index was up by 2.47%.

China’s Shanghai Composite rose 0.77% while the Shenzhen Component gained 1.36%.

Meanwhile, investors were trading with some caution after new COVID-19 outbreaks in both China and an increasing number of U.S. states were reported over the weekend. There are over 8 million cases globally as of June 16, according to Johns Hopkins University.

But some investors remained positive despite the numbers.

“We were able to shake off the early morning negative COVID-19 headlines from China…I think U.S. investors are keeping a close eye on the COVID-19 data, but it will take a more pronounced uptrend in positive cases for sellers to get more aggressive,” Joe Saluzzi, partner at Themis Trading LLC, told CNBC.

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