Asian shares were mostly higher Thursday following an advance on Wall Street after the Federal Reserve said the economy still looks healthy enough to keep interest rates where they are.
Markets were closed in Japan for a holiday.
Hong Kong’s Hang Seng lost 1.3% to 24,454.47 and the Shanghai Composite index edged 0.1% lower to 3,424.16.
In South Korea, the Kospi climbed 0.5% to 2,641.49, while Australia’s S&P/ASX 200 added 1.2% to 7,925.40.
Taiwan’s Taiex jumped 1.8%, while the SET in Bangkok edged 0.2% higher.
On Wednesday, Wall Street also got a boost from easing yields in the bond market. When Treasurys are paying investors less in interest, investors may be willing to pay higher prices for stocks.
The S&P 500 jumped 1.1% to 5,675.29, while the Dow Jones Industrial Average gained 0.9% to 41,964.63. The Nasdaq composite rose 1.4% to 17,750.79.
The rally followed weeks of sharp and scary swings for the U.S. stock market as investors fret over how much pain President Donald Trump will allow the economy to endure in order to remake the system. He’s said he wants manufacturing jobs back in the United States and far fewer people working for the federal government.
Trump’s barrage of announcements on tariffs and other policies have created so much uncertainty that economists worry U.S. businesses and households may freeze and pull back on their spending.
Fed Chair Jerome Powell acknowledged the rising pessimism among U.S. consumers and companies shown by recent surveys, but he also pointed to data such as relatively low unemployment that show the economy is still strong. It’s possible to have periods where “people say downbeat things about the economy and then go out and buy a new car,” he said.
“Given where we are, we think our policy is in a good place to react to what comes, and we think that the right thing to do is to wait here for greater clarity about what the economy’s doing,” Powell said.
The Fed has been holding interest rates steady this year after cutting them sharply through the end of last year. While lower rates can help give the economy a boost, they can also push inflation upward.
Fed officials indicated they’re still penciling in two cuts to the federal funds rate by the end of this year, just as they were forecasting at the end of last year. But they are also seeing weaker growth for the U.S. economy and higher inflation than they were before. More than anything, the message from the Fed seemed to be how much uncertainty is clouding everything.
Powell pushed back against fears about what’s called “ stagflation,” where the economy stagnates but inflation remains high. The Fed doesn’t have good tools to fix such a toxic combination. The last time the U.S. economy suffered through it was in the 1970s, and Powell said, “I wouldn’t say we’re in a situation that’s remotely comparable to that.”
The yield on the 10-year Treasury dropped to 4.24% from 4.31% just before the Fed announced its decision. The Fed said it will also begin paring the monthly reductions of its trove of Treasurys beginning in April. Such a move can help keep longer-term yields lower than they would otherwise be.
On Wall Street, Nvidia helped support the market after rising 1.8% to cut its loss for the year so far to 12.5%. It hosted an event Tuesday where it largely “did a nice job laying out the roadmap” and fighting back against speculation the artificial-intelligence industry is seeing a slowdown in demand for computing power, according to UBS analysts led by Timothy Arcuri.
Tesla rose 4.7%, following two straight losses of roughly 5%. It’s still down 41.6% for 2025 so far. It’s been struggling on worries that customers are turned off by CEO Elon Musk’s leading efforts to slash spending by the U.S. government.
In other dealings early Wednesday, U.S. benchmark crude oil gained 41 cents to $67.32 per barrel. Brent crude, the international standard, was up 43 cents at $71.21 per barrel.
The U.S. dollar fell to 148.32 Japanese yen from 148.69 yen. The euro rose to $1.0909 from $1.0905.
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AP Business Writers Stan Choe and Matt Ott contributed.