Asian shares rise, Fed outcome pressures dollar


Asian shares rose on Wednesday buoyed by strength in global equities markets, firmer economic sentiment in Germany and hopes of a deal from U.S. budget talks, while the dollar came under pressure ahead of the Federal Reserve’s policy decision.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.5 percent to a 16-month peak. The index has hit successive 16-month highs since Dec. 5.
Australian shares were up 0.4 after touching a nearly 17-month high on the back of Wall Street gains and higher iron ore prices.
“Definitely the momentum is to the upside,” said Stan Shamu, a market analyst at IG Markets. “Everyone seems to be pricing in a fairly positive outcome to the fiscal cliff negotiations as well.”
South Korean shares inched up 0.2 percent, shrugging off news of North Korea’s rocket launch, but profit-taking on large caps limited gains.
“North Korea is no longer an economic match for the South, so, short of a full-scale conflict, the North’s actions will have little impact on the KOSPI,” Im No-jung, chief economist at IM Investment & Securities, said of the Seoul stock market.
North Korea launched the second rocket this year on Wednesday just before 10 a.m. and may have finally succeeded in putting a satellite into space, the stated aim of what critics say is a disguised ballistic missile test.
Japan’s Nikkei share average rose 0.5 percent after hitting a 7-1/2-month high earlier, led by gains in tech shares and other exporters on the weak yen.
The dollar remained broadly under pressure on expectations the Fed will take further monetary easing step, pushing the currency down to a three-month low against the Australian dollar. The euro popped back above $1.3000, pulling away from a two-week low of $1.2876 plumbed Friday.