Asian stocks gain ahead of new Fed chief comments

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Associated Press

Posted on February 9, 2014 at 11:02 PM

Updated Sunday, Feb 9 at 11:06 PM

BEIJING (AP) — Asian stock markets were mostly higher Monday as investors looked ahead to Janet Yellen's first comments before Congress as the new Federal Reserve chairwoman.

Oil edged down but stayed close to $100 on optimism the American economy might be improving despite mixed U.S. jobs data on Friday.

China's Shanghai Composite Index gained 1.4 percent to 2,072.26 and Tokyo's Nikkei 225 was up 1.1 percent at 14,620.38. Seoul, Taipei and Sydney also gained.

Hong Kong's Hang Seng was the regional holdout, giving up 0.1 percent to 21,620.04.

The U.S. economy added 113,000 jobs in January, far below the 170,000 analysts had been expecting. But unemployment dipped to 6.6 percent, the lowest rate since the global financial crisis hit in late 2008, and more people sought jobs.

"The detailed data suggests the U.S. is indeed moving towards a stronger economy," said strategist Evan Lucas at IG Markets in a report.

Taiwan's Taiex shed 0.6 percent to 8,433.33 and Seoul's Kospi rose 0.1 percent to 1,924.29. Sydney's S&P/ASX 200 gained 0.6 percent to 5,197.20. Singapore, Manila and Jakarta also gained.

Investors were looking ahead to Yellen's appearance Tuesday before Congress for signs of whether the Fed might alter its plans to wind down its stimulus.

Rising stock markets suggested some traders think the Fed might postpone another reduction in its monthly bond-buying. But analysts warn that is far from certain.

The Fed had been buying $85 billion worth of bonds every month in an effort to stimulate the economy by pushing down commercial lending rates. The Fed said in December it will reduce that by $10 billion each month. That would reduce February's purchases to $65 billion if the Fed sticks to its plan.

"We think that the data is not weak enough for the Fed to pause on tapering, but also not strong enough to shift the base case of a modest recovery to a faster paced one," said Mizuho Bank in a report.

Benchmark U.S. oil for March delivery gained 4 cents at $99.92 in electronic trading on the New York Mercantile Exchange. The contract gained $2.04 on Friday to close at $99.88 after briefly peaking above $100 in mid-afternoon.

In currencies, the euro rose to $1.3627 from $1.3610 late Friday. The dollar fell to 102.33 yen from 102.49 yen.

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