Asia Mostly Improves Following Rate Cut

Stocks in Asia Pacific were mostly higher on Wednesday after the U.S. Federal Reserve announced an emergency rate cut on Tuesday.

The Nikkei 225 regained 17.33 points, or 0.1%, to 21,100.66.

The Japanese yen, often seen as a save-haven in times of economic uncertainty, traded at 107.55 per U.S. dollar after touching an earlier high of 106.84.

In Hong Kong, the Hang Seng Index docked 62.75 points, or 0.2%, to 26,222.07. That came after the latest release of IHS Markit’s Hong Kong Purchasing Manager’s Index, which hit a record low of 33.1 in February.

South Korea’s Kospi led gains among major Asian markets. The moves came as the country proposed an extra budget of 11.7 trillion Korean won ($9.86 billion U.S.) to combat the coronavirus outbreak and its economic impact, according to a report by Yonhap.

South Korea has more than 5,300 total confirmed cases so far, according to the Korea Centers for Disease Control and Prevention, making it the country with the highest number of infected outside of China.

Australia’s Gross Domestic Product for the fourth quarter rose above expectations, growing a seasonally adjusted 0.5% during the fourth quarter, according to data from the Australian Bureau of Statistics. That was higher than the forecast of a 0.3% growth of economists.

The Reserve Bank of Australia cut its cash rate to a new record low on Tuesday. The central bank’s Governor Philip Lowe said in a statement announcing the monetary policy decision that the "coronavirus outbreak overseas is having a significant effect on the Australian economy at present, particularly in the education and travel sectors."

Following the data release, the Australian dollar jumped to $0.6599 after an earlier low of $0.6574.

CHINA

The CSI 300 gained 23.69 points, or 0.6%, to 4,115.05.

A private survey released Wednesday showed China’s services sector seeing its worst month on record in February, according to Reuters. The Caixin/Markit services Purchasing Managers’ Index (PMI) plunged to 26.5 from 51.8 in January. The 50-point level in PMI readings separates growth from contraction.

In other markets

In Korea, the Kospi index gained 45.18 points, or 2.2%, to 2,059.33

In Taiwan, the Taiex added 64.63 points, or 0.6%, to 11,392.35

In Singapore, the Straits Times Index nudged ahead 5.47 points, or 0.2%, to 3,025.03

In New Zealand, the NZX 50 progressed 71.47 points, or 0.6%, to 11,417.78

In Australia, the ASX 200 dropped 110.28 points, or 1.7%, to 6,325.40