ASIAN MARKETS
HONG KONG—Asian stocks rose Thursday after President Donald Trump cut a deal with Democrats to extend borrowing limits to buy more time for the U.S. government, giving investors much needed relief.
KEEPING SCORE: Japan’s benchmark Nikkei 225 rose 0.4 percent to 19,431.58 and South Korea’s Kospi jumped 1.1 percent to 2,345.58. Hong Kong’s Hang Seng index added 0.4 percent to 27,736.13 but the Shanghai Composite dipped 0.2 percent to 3,379.93. Australia’s S&P/ASX 200 advanced 0.3 percent to 5,706.70.
DEBT DEAL: Trump came to a deal with congressional Democrats to raise America’s debt limit for three months, overruling Republicans in the process. The immediate goal was ensuring money for storm relief as Trump sought to help speed the $7.9 billion aid bill for Hurricane Harvey victims, but the move also helps keep the government operating, removing some short-term uncertainty for investors.
FED IN FLUX: In a surprise announcement, the Federal Reserve said Vice Chairman Stanley Fischer will resign next month for personal reasons, leaving a fourth vacancy on the U.S. central bank’s seven-member governing board. The unexpected departure of Fischer, a widely-respected economist, adds to a leadership vacuum at the top of the Fed as it navigates a difficult path. It plans to slowly raise interest rates as the U.S. economy grows and unemployment falls, even as inflation remains below target, complicating its future course.
NUCLEAR TENSIONS: North Korea’s nuclear program remains in the headlines, though investor concerns have faded somewhat as the U.S. seeks the toughest-ever U.N. sanctions on the country in a resolution that would go to a vote Monday. Meanwhile, the U.S. military completed placing more launchers for the high-tech U.S. missile-defense system installed in South Korea to better cope against Pyongyang’s threats.
QUOTEWORTHY: “Surprises galore are greeting Asia traders as we digest the astonishing overnight headlines,” said Stephen Innes, head of Asia trading at OANDA. Fischer’s resignation, the debt deal and an unexpected rate hike by Canada’s central bank on strong economic growth “all caught market watchers by surprise,” he said.
WALL STREET: Major U.S. benchmarks ended higher. The Standard & Poor’s 500 index rose 0.3 percent to 2,465.54. The Dow Jones industrial average added 0.3 percent to 21,807.64. The Nasdaq composite gained 0.3 percent to 6,393.31.
ENERGY: The rally in oil futures fizzled out. Benchmark U.S. crude dipped 6 cents to $49.10 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained 50 cents, or 1 percent, to settle at $49.16 a barrel Wednesday.