Dollar, North Asia stocks firm on positive US GDP data

Tuesday, 29 March 2016 00:00 - - {{hitsCtrl.values.hits}}

Reuters: The dollar firmed on Monday and stocks in North Asia rose after fairly strong consumer spending led to an upward revision in U.S. economic growth in the fourth quarter, helping to underpin investor sentiment.

“As long as the U.S. economic recovery is continuing, I would think the rally in global equity markets will continue,” said Takeru Ogihara, chief strategist at Mizuho Trust Bank.

U.S. stock futures ticked up 0.3%, although they remain flat for the quarter.

The dollar index against a basket of six major currencies rose 0.2% to 96.378, its highest in almost two weeks. The dollar rose 0.6% to 113.64 yen, keeping intact its steady recovery from a 6-1/2-month low of 110.67 hit on 17 March.

That gave Japan’s Nikkei a 0.7% boost to a 1-1/2-week high.

Shares in Korea were little changed, and Taiwan advanced 0.1%, while Chinese stocks added 0.6%.

Share markets in Australia, New Zealand and Hong Kong were closed for holidays. That left MSCI’s broadest index of Asia-Pacific shares outside Japan down 0.1%, with Southeast Asian markets having a larger-than-usual impact.

Indonesia, Malaysia and the Philippines, which were all trading between 0.2% and 0.8% lower, while Singapore was little changed.

Gold was also a casualty of the dollar’s strength, with spot gold sliding 0.5% to its lowest in a month.

U.S. gross domestic product increased at a 1.4% annual rate in Oct-Dec, above the previously reported 1.0% pace, the third GDP estimate showed on Friday.

With the U.S. seen as one of the brightest spots in the global economy, signs of resilience there are pivotal to boosting market sentiment.

The euro was little changed at $1.1154, not far from Thursday’s one-week low of $1.1144.

The Australian dollar was steady at $0.7502 having lost 1.4% last week and knocked away from an eight-month high of $0.7681.