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Asian stocks edged up on Wednesday after upbeat US economic growth data calmed investor anxiety over a deteriorating global outlook, while the Australian dollar languished near four-year lows against the dollar.
Nikkei 225 was up 20 points or 0.11 per cent at 17,427 and Hang Seng rose 35.76 points or 0.15 per cent to 23,879.67.
Oil prices were also under pressure as major oil producing nations failed to agree on curbs to output ahead of an OPEC meeting on Thursday.
US GDP data
The US Government had upgraded its reading on third quarter gross domestic product to 3.9 per cent on Tuesday from 3.5 per cent reported last month. Economists polled by Reuters had expected growth would be cut to 3.3 per cent.
“The gap between actual and estimated third quarter GDP was a big one, but what is of increasing import is the gap between the economy of the US and the rest of the world especially Europe and Japan,’’ Jasper Lawler, analyst at CMC Markets, said in a note.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.3 per cent. Australian shares rose 0.9 per cent after Mainland Chinese shares hit fresh three-year highs, helped by last Friday’s rate cuts from the People’s Bank of China, while Tokyo’s Nikkei retreated 0.1 per cent, weighed by the yen’s bounce.
US Treasury yields
The 10-year US Treasury yields dropped to a one-month low of 2.252 per cent, as strong auction results, month-end buying and an unexpected drop in US consumer confidence offset the encouraging GDP news.
That also helped the dollar put some distance from a seven-year high against the yen.
The greenback was down 0.1 per cent at 117.82 yen, pulling further away from a seven-year high of 118.98 reached the previous week. The euro was little changed at $1.2477.
Australian dollar
In contrast, the Australian dollar hovered near a four-year low of $0.8514. The Aussie has been under pressure amid the recent tumble in the prices of iron ore, Australia’s key export commodity.
“The AUD sits squarely at the bottom of the G10 pack in the past 24 hours and heading into the NY close, with a fresh slide in iron ore prices, now to below $70 for the first time since June 2009, adding pressure,’’ said Ray Attrill, global co-head of FX strategy at National Australia Bank.
Crude oil
Crude oil extended losses after a meeting of Saudi Arabia and three other nations ahead of Thursday’s closely-watched OPEC summit ended with no deal to curb crude output.
US crude was down 24 cents at $73.85 a barrel, near a four-year low of $73.25 hit a little more than a week ago.
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