Most Asian markets performed well, as did the markets globally, after Larry Summers withdrew from the Fed race. The dollar weakened against major trading partners and fell below the 100 yen to the dollar mark.
Lawrence Summers, who was President Obama's first choice to come the next Federal Reserve Chairman, has pulled out of the race. Harver Group analysts see this as a positive catalyst for the markets as he was the candidate most likely to reduce the central bank's quantitative easing program. Janet Yellen is now the likely successor to Bernanke, Harver Group analysts see her as much more dovish than Summers and unlikely to withdraw monetary stimulus and put unneeded pressure on the recovering economy.
Following the news from the Fed, markets across the region were trading higher. Hong Kong's Hang Seng Index climbed 1.5%, while China's Shanghai Composite Index fell 0.2%. Thailand's SET and Philippines PSE Composite, which have underperformed this summer due to fears of a withdrawal of US stimulus, were the day’s biggest gainers, rising 2.5% and 2.8% respectively. Analysts at Harver Group are recommending banking stocks to clients to clients who are looking for strong dividends, Bank of China Ltd. rose 2% and HSBC Holdings climbed 1.3%.
The US dollar weakened against major trading partners, it weakened to 98.75 yen from 99.37 on Friday. The Australian dollar climbed to 93.64 American cents and the Euro rose to $1.33. A weakening US dollar, gold generally climbs. It moved 1.2% higher to $1,324.60 an ounce.
In Sydney, the S&P/ASX 200 Index climbed 0.5%. Analysts at Harver Group are recommending mining firms as precious metal prices increase. Rio Tinto rose 0.5%, in Hong Kong Cnooc Ltd gained 0.5% and in Singapore Noble Group climbed 5%.