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Asian shares mixed after Bernanke comments on stimulus

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(Globalpost/GlobalPost)

Asian markets were mixed on Thursday after US Federal Reserve chief Ben Bernanke said the bank had no plan to wind down its stimulus until the economy was back on track.

The comments, which came as a closely watched report said growth was moderate, helped calm nervous dealers and helped Wall Street end in positive territory.

Tokyo rose 0.64 percent as confident forex dealers pushed the dollar back towards the 100 yen level, while Sydney was 0.30 percent higher. However Hong Kong dipped 0.16 percent and Shanghai was off 0.21 percent while Seoul fell 0.68 percent.

In his first of two days of his testimony to congress, Bernanke told Representatives the vast bond-buying programme would remain in place until the Fed is happy the economy can stand on its own two feet.

"I emphasise that, because our asset purchases depend on economic and financial developments, they are by no means on a preset course," Bernanke told the lawmakers.

When launching the scheme in September the bank said it would only reel it in when unemployment had fallen to a satisfactory level.

Bernanke said the economy was expanding at a moderate pace and showed solid signs of strength in various areas, a view supported by the Fed's Beige Book report, which was also released on Wednesday. Bernanke is due to be grilled by Senators on Thursday.

SMBC Nikko Securities general manager of equities Hiroichi Nishi said: "Bernanke's words were nothing new, but did have a calming effect for those still harbouring jitters about a near-term end of the US easing policy."

The testimony lifted US shares. The Dow added 0.12 percent, the S&P 500 put on 0.28 percent and the Nasdaq was up 0.32 percent.

On forex markets the dollar rose against the yen as traders saw the news as a boost for the regional economy.

In early trade the greenback was at 99.81 yen, compared with 99.60 yen in New York late Wednesday, while the euro fetched $1.3107 and 130.82 yen against $1.3125 and 130.73 yen in US trade.

Eyes will now be on a meeting of G20 finance ministers on Thursday and Friday in Moscow, where officials are expected to discuss the Fed's stimulus, while Japan will hold upper house elections at the weekend.

On oil markets New York's main contract, West Texas Intermediate for delivery in August, fell 21 cents to $106.27 a barrel, while Brent North Sea crude for September eased 13 cents to $108.48.

Gold cost $1,286.30 per ounce at 0200 GMT, compared with $1,286.30 late Wednesday.

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http://www.globalpost.com/dispatch/news/afp/130718/asian-shares-mixed-after-bernanke-comments-stimulus