Janet Yellen, chair of the U.S. Federal Reserve, waits to begin a Senate Banking
Committee hearing in Washington, D.C.
Photographer: Andrew Harrer/Bloomberg
by Jonathan Burgos | 4:10 PM PST | February 24, 2015
(Bloomberg) -- Asian stocks gained, with the regional benchmark extending a five-month high, after Federal Reserve Chair Janet Yellen indicated an increase in interest rates is unlikely before mid-year.
The MSCI Asia Pacific Index climbed 0.3 percent to 145.82 as of 9:01 a.m. in Tokyo after closing at its highest since Sept. 12 on Tuesday. The Standard & Poor’s 500 Index advanced to a fresh record after Yellen told the Senate Banking Committee that wage growth remain too low even as the job market improves, and signaled that a change in the Fed’s guidance on interest rates won’t lock it into a timetable for tightening.
“Equities are slightly fully priced but aren’t unduly expensive,” Angus Gluskie, managing director at White Funds Management in Sydney, where he oversees about $550 million, said by phone. Yellen’s statement “doesn’t alter anything from our perspective as investors. We’re not yet in a fully synchronized global recovery but broadly most economies are developing in a right way. There are black spots. Chinese economic activity has been a concern.”
Japan’s Topix index added 0.3 percent. South Korea’s Kospi index advanced 0.7 percent. Australia’s S&P/ASX 200 Index slid 0.2 percent. New Zealand’s NZX 50 Index jumped 1.4 percent as it headed for a record close.
Markets in Hong Kong and China have yet to open, with mainland markets resuming trading following the Lunar New Year holidays. A preliminary gauge of China’s manufacturing due today from HSBC Holdings Plc and Markit Economics is expected to signal a third month of contraction.
Energy shares were the only group to decline on the MSCI Asia Pacific Index after West Texas Intermediate oil posted the longest losing streak since August. U.S. crude stockpiles are expected to have swelled by 4 million barrels last week from a record, according to a Bloomberg survey ahead of the official government report Wednesday.
Futures on the S&P 500 were little changed. The U.S. equity benchmark climbed 0.3 percent yesterday to a fresh record high. The Nasdaq Composite Index added 0.1 percent, climbing for a 10th straight day to bring it within 1.6 percent of its 2000 record.
Yellen repeated that the Fed’s pledge to be “patient” on beginning to raise the benchmark interest rate means an increase is unlikely for “at least the next couple” of meetings.
Euro-area finance ministers agreed to extend a bailout program for Greece after the government said it would undertake measures including a revamp of tax collection. International Monetary Fund Managing Director Christine Lagarde said Greece’s policy proposals fall short on key changes and may not meet the lender’s benchmarks for aid to continue.
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