Asian stocks rise thanks to strong US GDP, Fed and China by Reuters

By Andrew Galbraith

SHANGHAI (Reuters) – Asia's stock markets edged up on Monday after surprisingly strong US economic growth in the first quarter, but gains were limited by cautious about less optimistic elements in the GDP report. weakening.

Investors were also waiting this week for the US Federal Reserve meeting and data from Chinese factories to get new clues about policy direction in the world's largest economies.

The widest MSCI index of Asia Pacific shares out of Japan rose less than 0.1%, after recording its biggest weekly decline for more than a month the week last.

Australian stocks fell 0.26%, while those in Seoul rose 0.4%.

The Japanese financial markets are closed for a long holiday this week, but they were 0.72% higher in Singapore.

In contrast to weakness in Asian markets last week, Wall Street ended the day well after data showing that US gross domestic product grew at an annualized rate of 3.2% in the first quarter.

The increase of 0.31 percent to 26,543.33 and the addition or 0.34 percent to 8,146.40.

The S & P 500 rose 0.47% to 2,939.88, its second closing record for the week.

Stephen Innes, managing partner of SPI Asset Management, said that despite stronger-than-expected earnings contributing to rising markets, he was seeing S & P positioning "overly broad".

"We have gone from a state of the stock market that nobody wants to participate in a frenzied madness where hedge funds and investors continue to chase markets like greyhounds with mechanical rabbit," he said.

Strong GDP data helped mitigate fears of an impending recession, but investors noted that the decline was due to a smaller trade deficit and a large build-up of unsold products. consumers and businesses have slowed down considerably.

In a morning note to customers, National Australian analysts said that solid GDP was "moderate", pointing to the weakness of inflation.

"It is thought that a dip in inflation could cause the Fed to cut rates before 2019 – at a time when the Fed is openly discussing its desire to tolerate a period of higher inflation than the US dollar." 39; goal to offset past deficits – which had rate markets shifting the implied probability of a 2019 easing, "they said.

The March reading for basic personal consumption expenditure (PCE), the Fed's preferred inflation measure, is due on Monday. The central bank will announce Wednesday its political decision. President Jerome Powell should strike a balance between strong growth data and lingering concerns about global growth prospects.

Markets will also look at global surveys of factory activity this week, including on official and private readings of Chinese manufacturing industry, which will be released Tuesday.

While better-than-expected Chinese data for March has eased fears of a global slowdown, they have also sparked intense debate over even stronger stimulus packages that Beijing can deploy without risking a rapid accumulation of debt and bubbles.

In the currency markets, the dollar was stable against the yen at 111.61. The euro also barely changed, registering an increase of 0.02% to 1.115 USD.

The, which follows the bank note against a basket of six major rivals, rose slightly to reach 98,033.

fell 0.7% to 62.86 dollars a barrel, a drop that was maintained after US President Donald Trump lobbied Friday on the Organization of Petroleum Exporting Countries for it to increase its crude oil production in order to bring down the prices of gasoline.

fell to $ 71.6 per barrel.

was slightly lower, trading at $ 1,285.29 an ounce.