Moderate rise in Asian stocks as Fed frames rate hike timeline

Bangkok: Stocks climbed in Asia on Thursday, tracking Wall Street's gains, after the Federal Reserve said it would accelerate its pullback of economic stimulus. The Fed said it would raise interest rates three times next year to tackle rising inflation and will shrink its monthly bond purchases at twice the pace it previously announced, in line with ending them altogether in March.

Tokyo's Nikkei 225 index rose 2.1% to 29,066.32 and the Kospi in South Korea picked up 0.6% to 3,006.41. The Shanghai Composite index added 0.8% to 3,675.02. India and Taiwan rose, while Sydney's S&P/ASX 200 lost 0.4% to 7,295.70. In Hong Kong, the Hang Seng clawed back from early losses, gaining 0.4% to 23,503.03.

Simmering tensions between Beijing and Washington are casting a shadow, analysts say, after the US. House of Representatives passed a resolution to ban imports from China's Xinjiang region due to concerns about forced labour and other abuses. Apart from that, the US reportedly is considering sanctions that would prevent companies providing equipment to China's biggest computer chips maker, SMIC. The company's Hong Kong traded shares dropped 5% on Thursday. They have declined nearly 22% in the past six months. "Some concerns on potentially tougher sanctions from the US have kept investors shunning, with China's SMIC recently under US scrutiny once again, and that may seem to cap gains for China tech sector today," Yeap Jun Rong of IG said in a commentary. While the US is hastening its efforts to counter inflation, central banks in Europe are not expected to follow suit, analysts said.

"ECB doves are not set to budge," Mizuho Bank said in a market report. "For one, while economic recovery endures, it remains fragile, threatened by the omicron' variant," it said.