There were also gains in Sydney, Seoul, Singapore, Wellington, Taipei, Jakarta and Manila, although Tokyo fell more than 1 per cent on traders’ first day back from a long weekend.
Traders will be keeping a keen eye on the release later in the day of minutes from the Federal Reserve’s December policy meeting, where they slowed their pace of interest rate hikes but signalled they would end at a higher level than expected.
The news scuttled a pre-Christmas rally across world markets and the minutes will be pored over for clues about policymakers’ plans for this month’s gathering.
There is a broad consensus that the Fed’s tightening measures to tame runaway inflation will tip the United States into recession, while the head of the International Monetary Fund has also warned a third of the global economy will contract this year.
Former New York Fed boss William Dudley told Bloomberg Surveillance on Tuesday: “A recession is pretty likely just because of what the Fed has to do.”
However, he added that “what’s different this time, I think, is that if we have a recession, it’s going to be a Fed-induced recession and the Fed can end the recession by subsequently easing monetary policy”.
Dudley said he did not see “a big risk of a financial-instability cataclysm that pushes the economy into a deep recession”.
Crude prices were virtually flat, having been hammered more than 4 per cent Tuesday by a range of issues including a mild European winter, a pick-up in the dollar and China’s reopening uncertainty.
“Rising Chinese COVID infections could weigh on demand in the immediate term,” said Warren Patterson at ING Groep. He added that the long-term outlook remained better as growth picked up.
KEY FIGURES AROUND 0230 GMT
Tokyo – Nikkei 225: DOWN 1.4 per cent at 25,724.66 (break)
Hong Kong – Hang Seng Index: UP 1.6 per cent at 20,470.70
Shanghai – Composite: UP 0.3 per cent at 3,126.26
Dollar/yen: DOWN at 130.76 yen from 130.92 yen on Tuesday
Euro/dollar: UP at $1.0567 from $1.0554
Pound/dollar: UP at $1.1996 from $1.1969
Euro/pound: DOWN at 88.08 pence from 88.15 pence
West Texas Intermediate: FLAT at $76.92 per barrel
Brent North Sea crude: UP 0.2 per cent at $82.24
New York – Dow: FLAT at 33,136.37 (close)
London – FTSE 100: UP 1.4 per cent at 7,554.09 (close)
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