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Wednesday, Feb 27, 2013 5:30 AM UTC

Asian stocks mostly up on Fed’s low rates support

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Asian stocks mostly up on Fed's low rates supportA currency trader works at a foreign exchange company in Tokyo,Tuesday, Feb. 26, 2013. In currency markets, the dollar was down 0.7 percent to 91.92 yen. But the yen, which has fallen by about 20 percent in recent weeks, is still much weaker than it was for most of last year. (AP Photo/Koji Sasahara)(Credit: AP)

SEOUL, South Korea (AP) — Asian stock markets mostly rose Wednesday after the Federal Reserve chief played down risks from the U.S. central bank’s low interest rate policies, offsetting worries that Italy’s indecisive election result will rekindle Europe’s debt crisis.

Hong Kong’s Hang Seng advanced 0.4 percent to 22,605.62 and South Korea’s Kospi added 0.4 percent to 2,007.94. Australia’s S&P/ASX 200 gained 0.6 percent to 5,033.80. Shares in mainland China, Taiwan and Indonesia also rose.

Japanese stocks were the only losers in Asia as the yen strengthened against the U.S. dollar following several months of weakness that boosted exporters. Japan’s Nikkei 225 fell 0.5 percent to 11,345.54.

In testimony to Congress on Tuesday, Federal Reserve Chairman Ben Bernanke expressed confidence that the central bank’s low-rate policies currently pose little risk of causing runaway inflation or a stock market bubble. That eased recent jitters the Fed would start to withdraw its super easy monetary policy.

U.S. economic indicators also gave Asian markets a lift. Home sales rose to the highest level in more than four years last month and American consumers showed confidence for the first time in three months in February.

“Asian markets held up well after U.S. stock markets showed little impact to Italy’s election results,” said Kwak Joong-bo, a Seoul-based analyst at Samsung Securities.

Samsung Electronics Co., the world’s largest maker of memory chips, televisions and mobile phones, rose 0.7 percent while Hyundai Motor Co. climbed 0.9 percent. Taiwan-based phone maker HTC Corp. also added 1.3 percent.

Yet stock market gains in Asia remained modest, showing that investors have not fully regained their appetite for risky assets ahead of looming automatic spending cuts due to start Friday in the U.S.

And with Italy emerging from elections on Tuesday with no clear winner, there are lingering uncertainties about the fate of deficit and debt reduction measures in one of Europe’s biggest economies.

The Italian election result drove markets in Europe markedly lower. If Italian parties fail to form a governing coalition, new elections would be required, causing more uncertainty and a leadership vacuum.

On Tuesday, Italy’s FTSE MIB index fell nearly 800 points, or 5 percent, to 15,552. Germany’s DAX was down 176 points, or 2.3 percent, to 7,597 and the CAC-40 in France fell 99 points, or 2.7 percent, to 3,621.

The Dow Jones industrial average rose 115.96 points, or 0.8 percent, to 13,900.13 on Tuesday. The Standard & Poor’s 500 index rose 9.09 points, or 0.6 percent, to 1,496.94. The Nasdaq composite index rose 13.40 points, or 0.4 percent, to 3,129.65.

In currency markets, the euro was little changed at $1.3061. The dollar weakened 0.4 percent to 91.88 yen.

Benchmark crude for April delivery was up 4 cents to $92.67 a barrel in electronic trading on the New York Mercantile Exchange.

More By Youkyung Lee.

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