Asian shares notch gains after Wall Street's record close as investors digest Fed minutes – CNBC

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Most Asian shares gained on Thursday after Wall Street closed at record levels following the latest minutes from the Federal Reserve. Meanwhile, the dollar remained on the back foot.

Japan’s Nikkei 225 rose 0.45 percent, extending gains after finishing the Wednesday session at its highest levels since 1996. Softbank Group contributed to broader gains on the index, with the company’s stock surging 3.96 percent.

Across the Korean Strait, the Kospi rose 0.11 percent as gains in manufacturing stocks were offset by moderate declines in blue-chip exporters: Samsung Electronics was off 0.73 percent and Hyundai Motor fell 1.29 percent.

Down Under, the S&P/ASX 200 rose even as a fall in major mining stocks offset gains seen in other sectors. Miners lost ground after iron ore prices sank overnight: Fortescue Metals fell 1.41 percent and Rio Tinto was down 1.51 percent. The benchmark index tacked on 0.13 percent by 10:08 a.m. HK/SIN.

Greater China markets, however, bucked the trend to edge down. Hong Kong’s Hang Seng Index was off 0.02 percent. On the mainland, the Shanghai Composite lost 0.22 percent and the Shenzhen Composite slipped 0.114 percent.

Minutes from the Federal Reserve’s last meeting showed that one more interest rate increase in the U.S. this year was “likely to be warranted” given that the economic outlook remained “unchanged” in the medium term, a summary showed. Policymakers, however, remained concerned about inflation.

Expectations for one additional rate hike by year-end stood at 88 percent as of Thursday, according to the CME Group’s FedWatch tool.

On Wall Street, major indexes closed at record levels as investors digested those minutes. The Dow Jones industrial average rose 0.18 percent, or 42.21 points, to end at a record 22,872.89.

The dollar, however, sank to a 14-day low as investors took note of Fed members’ concern over the inflation outlook stateside. The dollar index, which measures the U.S. currency against a basket of rivals, stood at 92.878 at 9:54 a.m. HK/SIN — off a 10-week high touched touched last week following the release of September jobs numbers.

Against the yen, the dollar edged down to fetch 112.40 yen.

“In a week when North Korean tensions prevented the dollar from rallying, the lack of unambiguously hawkish Federal Open Market Committee minutes was just the excuse that foreign exchange traders needed to send the dollar lower,” Kathy Lien, managing director of FX strategy at BK Asset Management, said in a note.

Weakness in the dollar index was also in part due to the firmer euro, which extended overnight gains on Thursday. The common currency had climbed on Wednesday after the Spanish government asked for greater clarity from Catalan authorities over whether or not the region had declared independence. The euro traded at $1.1868 at 9:55 a.m. HK/SIN, which was its highest levels in more than two weeks.

Meanwhile, bank stocks were in focus during Asian trade after the International Monetary Fund on Wednesday identified several banks that could “struggle” with profitability in the years ahead, the Wall Street Journal said. Those names included Sumitomo Mitsui Financial Group, Mizuho Financial Group, Standard Chartered and Mitsubishi UFJ Financial Group.

Japanese financials highlighted by the IMF traded slightly lower on the day: SMFG and Mizuho reversed early gains to slide 0.32 percent and 0.2 percent, respectively. MUFJ was off 0.6 percent. Meanwhile, Hong Kong-listed shares of Standard Chartered declined 0.63 percent.

Other market movers included shares of Japan’s Toshiba, which soared 4.09 percent, outperforming other tech sector stocks. The Tokyo Stock Exchange had cancelled its “security on alert” designation on the company’s stock.

Shares of Kobe Steel edged up 0.8 percent following huge sell offs in the previous two sessions after the company admitted to falsifying data to meet customer requirements. The company stated Wednesday it had discovered 70 cases of data fabrication at one of its units, Reuters reported.

On the energy front, oil prices slid after rising for a third consecutive session on Wednesday. Brent crude erased overnight gains to slip 0.61 percent, trading at $56.59 a barrel. U.S. West Texas Intermediate crude declined 0.55 percent to trade at $51.02.

The economic calendar for Thursday is fairly busy, but few of the day’s data points are likely move markets significantly (all times in HK/SIN):

  • 12:00 p.m.: Malaysia August industrial output
  • 1:00 p.m.: Singapore August retail sales
  • 4:00 p.m.: China September vehicle sales
  • 8:00 p.m.: India September CPI and industrial production