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Asian stocks rise, dollar falls on Fed easing wagers

Asian stocks rose on Thursday with Japanese shares reaching a new record high. Wall Street's tech-led gains, positive earnings, and expectations of U.S. interest rate cuts all contributed to the upbeat sentiment.

Prospects of a meeting between U.S. president Donald Trump and Russian president Vladimir Putin to discuss the conflict in Ukraine also boosted sentiment. The euro benefited, but oil prices fell as traders assessed the prospects for sanctions against Moscow.

Sterling held steady at its one-week-high going into the Bank of England policy announcement that was to be made later that day. A quarter-point reduction is widely expected and attention has been focused on a potential three-way split in the Board.

Markets have largely shrugged off Trump's recent tariff threats. These include an additional 25% tariff for India on purchases of Russian oil, and a threat to impose a 100% duty on chips.

The broad Topix Index in Japan rose by 0.9%, reaching a new high. The more technology-oriented Nikkei index also gained about the same amount.

Taiwan's benchmark stock index surged by 2.3%, reaching a record high of more than a year. South Korea's KOSPI rose 0.6%.

Hong Kong's Hang Seng index rose by 0.4% and mainland Chinese blue-chips advanced by 0.3%.

Australian shares have dipped slightly after reaching a record-high on Wednesday.

The futures for U.S. stocks are booming, with the S&P 500 rising by 0.3% and the Nasdaq gaining 0.3%. The S&P 500 rose 0.7% on Wednesday and the Nasdaq Composite increased 1.2%.

Capital.com analyst Kyle Rodda said in a recent note that Wall Street "seems to have gotten back its mojo".

There are still persistent downside risks. He said that the number of negative surprises in official statistics is increasing.

The forward price-to-earnings ratio is also at its highest level in four years. "Trade uncertainty persists."

The U.S. Dollar remained lower on Thursday against major peers, as expectations of a more accommodative policy by the Federal Reserve were stoked by both some disappointing macroeconomic data - including Friday's payrolls report -- and Trump's decision to install new Fed board members who are likely to share his dovish views about monetary policy.

The focus is on Trump's nominee to fill the upcoming vacancy in the Fed Board of Governors, and on candidates for the next Chair of the Central Bank. Jerome Powell's current tenure ends in May.

After a 0.6% drop on Wednesday, the dollar index (which measures the currency's value against the Euro, Sterling and four other counterparts) gained a little to 98.245.

The euro was unchanged at $1.1657 after the 0.7% increase in the previous session.

The Sterling is steady at $1.3356.

Thursday the BoE is expected to lower interest rates for a fifth time in a year, but the nagging concerns about inflation will likely split policymakers and cloud their outlook.

Two members of the Monetary Policy Committee may advocate for a rate reduction by a half point, while two others may argue for no change.

The dollar increased by 0.1%, to 147.53 Japanese yen.

The weaker dollar helped gold gain 0.4%, to $3,382 an ounce.

Crude oil recovered some of its losses from Wednesday when Brent and West Texas Intermediate both fell about 1%.

Brent crude futures rose 20 cents or 0.3% to $67.09 per barrel. U.S. West Texas intermediate crude gained 22 cents or 0.3% to $64.57 per barrel.

(source: Reuters)