Japanese stocks jumped to their strongest level in nearly seven months, and the dollar surged to a five-year high against the yen, as investors interpreted the U.S. Federal Reserve’s move to pare back its bond-buying program as a sign the world’s biggest economy is improving.
In Tokyo, the Nikkei 225 index spiked 271,42 points, or 1.7%, to 15,859.22, as exporters benefited from the weaker yen which makes goods cheaper to overseas buyers,
Hong Kong’s Hang Seng Index tumbled 255.07 points, or 1.1%, to 22,888.75
The biggest action in Asia following the Fed meeting was in the currency markets. The U.S. dollar surged 1.6% against the yen overnight, pushing the Japanese currency to its lowest level since October 2008, though the yen rebounded slightly in early Asia trade.
The Australian dollar also fell to its lowest level since August 2010 as the U.S. dollar surged broadly against most other currencies.
The Fed’s last policy meeting of the year concluded on Wednesday, and the central bank said it would start to wind down its bond-buying program in January — a process that has become known as "tapering" — that will continue next year, as long as the U.S. economy remains on a recovery track.
The central bank’s $85-billion U.S. monthly purchase of bonds will see an initial cut of $10 billion U.S., though the Fed assured investors that its easy monetary stance will remain in place, suggesting stocks may remain attractive relative to historically low-yielding bonds.
Although tapering was the main event for global markets, a number of companies in Hong Kong were in focus as they started trading — the latest in a string of Chinese companies to debut in city after completing initial public offerings.
Shanghai-based funeral-services provider Fu Shou Yuan International Group rose 52.8% after raising $215 million U.S. in a highly popular IPO. Another new listing, Kerry Logistics Network, rose 3.7% on its debut.
The new listings come just before Hong Kong’s largest IPO of 2013 starts to trade. China Everbright Bank raised $2.6 billion U.S. in Hong Kong and is slated to start trading on Friday.
In other markets;
Shanghai’s CSI 300 index fell 24.82 points, or 1.1%, to 2,332.41
Korea’s Kospi Index inched up 1.02 points, or 0.1%, to 1,975.65
Taiwan’s Taiex Index improved 58.36 points, or 0.7%, to 8,407.40
The Singapore Straits Times Index regained 8.45 points, or 0.3%, to 3,070.23
In New Zealand, the NZX 50 picked up 31.18 points, or 0.7%, to 4,707.06
In Australia, the S&P/ASX 200 climbed 106.13 points, or 2.1%, to 5,202.23
