Overnight Markets: Asian stocks rise on hope Fed will act to boost growth

Asian stock markets on Monday rose after a larger-than-estimated cut in US jobs stoked optimism the Federal Reserve will follow the region’s central banks in further stimulating economic growth, bolstering a fragile global economic recovery.

The MSCI Asia Pacific excluding Japan Index rose 0.4% to 460.45 at 12:38 p.m. in Sydney. The S&P/ASX 200 Index climbed 0.6% as a statistics bureau report showed Australian home-loan approvals rose in August from a month earlier. South Korea’s Kospi index gained 0.2%, while New Zealand’s NZX 50 Index added 0.1%. Shanghai Composite Index was up 1.46% at 2,779. Japanese markets are closed for a public holiday.

In company news, BHP Billiton added 0.7% as oil and metal prices rallied. Yanzhou Coal Mining jumped 10% in Shanghai. Fortescue Metals Group, Australia’s third-largest iron-ore exporter, surged 5.7% in Sydney after securing bank funding.

In the US and Europe, investors this week will take their cue from a raft of economic data that will give some insight into which central banks will embark on further quantitative easing, when they will act and by how much.

Markets look forward to minutes of the latest Fed meeting to be released on Tuesday that will shed light on a timetable and under what conditions the central bank would act.

Data from the US this week include manufacturing output from one of the crucial industrial regions, reflected in the Empire State index. Friday’s report of production in New York is likely to show continued volatile trend.

Consumer prices on Friday are expected to have risen 0.2% in September because of increases in food prices but, overall, US inflation is set to remain benign.

Eurozone will release its industrial production data on Wednesday which is expected to show that annual industrial output increased 7.4% in August, up from 7.2% in July.

September’s data published on Tuesday look likely to show that consumer price inflation in UK remained at an annual rate of 3.1%, well above the Bank’s target of 2%. Meanwhile, homeowners face more gloom when the Royal Institution of Chartered Surveyors shows that the supply/demand balance remains in buyers’ favour.