Global stock markets rallied on Thursday as the Fed’s latest policy statement sounded more dovish than expected and investors shrugged off disappointing manufacturing data from China.
The US Central Bank decided to keep the interest rates unchanged and promised that the future monetary policy change would be done patiently and depending on the economic environment. Fed Bankers voted unanimously to keep interest rates between 2.25% and 2.5%.
In a statement after its two-day meeting, the Federal Reserve said economic growth remained “stable” and expects this to continue.
Asian markets recap
Most of the main stock indexes in the Asia-Pacific region ended today’s session on the green amid weak Chinese economic data, which showed a second consecutive month of shrinking production activity in the country.
On the Chinese markets, the continental index Shanghai Composite added 0.35% to 2,584.57 points. Hong Kong’s index Hang Seng rose by 306.58 points, or 1.11%, to 27,949.43 points. Production activity in the second largest economy in the world shrank in January, according to the official data. The Purchasing Managers Index (PMI), which measures production activity, reaches a level of 49.5 points, according to information from China’s National Bureau of Statistics. This value is higher than the previous month when the PMI index reached 49.4 points.
On the Tokyo Stock Exchange, the blue-chip index Nikkei 225 posted an increase of 216.95 points, or 1.06%, to 20,773.49 points. The stocks of the Japanese SoftBank conglomerate rose by 4.77%.
South Korean index Kospi wiped out 0.06% of its value and ended the session at 2,204.85 points. Samsung Electronics declined by 0.54% after the company warned of lower-than-expected corporate data in 2019.
In Australia, local S&P ASX 200 declined by 0.37% to 5,864.70 points, with energy companies still managing to finish the day with a 1.7% increase. The stocks of Santos and Woodside Petroleum increased by 2.69% and 0.82%, respectively. The shares of Beach Energy rose by 5.13% after the company raised its 2019 forecast for production.
European markets mid-session recap
The German index DAX 30 is trading unchanged after the initial optimism diminished and wiped out earlier loses. The index is up by 0.39 points to 11,182.05 points at 11:45 GMT. The stocks of the electronics retailer Ceconomy AG jumped by 2.4% after appointing a new CEO. Software AG slumped by over 6% after a disappointing trading update with a warning on FY19 margins. In economic releases, German retail sales declined sharply in December, defying expectations for a further increase, preliminary data from the Federal Statistical Office showed. The retail sales fell by 2.1% year-on-year, after a 1.9 percent increase in November.
British stocks rose strongly on Thursday. The benchmark FTSE 100 was up 0.63% to 6,985.05 points at mid-session, after rallying 1.6% on Wednesday. Spirits maker Diageo jumped over 4% after it posted strong first-half results. The stocks of the dairy company Dairy Crest Group rose by 1.2% after posting good results in its third quarter and said the outlook for the full year remains in line with expectations. Royal Dutch Shell rallied 3.4% after its full-year profit surged by more than a third to the highest since 2014.
French index CAC 40 is up by 0.17% to 4,983.36 points after initially crossed the threshold of 5,000 points, but suffered serious resistance and turned down.
Wall Street pre-session recap
The US stock index futures pointed to a mixed start to trading on Thursday after the Federal Reserve kept interest rates unchanged.
At 7:00 a.m. ET, Dow futures implied a drop of more than 27 points at the open. Futures for the S&P 500 and Nasdaq pointed to a slightly higher open, with an expected positive start of 4.80 points and 53.84 points, respectively/
The markets will watch for the weekly jobless claims and an employment cost index are due at 8:30 a.m. ET, Chicago PMI data are due at 9:45 a.m., and new home sales data are expected at 10 a.m.