Asian markets rise on hopes for interest rate cuts

A currency trader works near screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea, Thursday, Feb. 7, 2019. Asian shares were mostly higher Thursday on news that the Reserve Bank of Australia may cut interest rates, driving hopes that other central banks could come to the same conclusion. (AP Photo/Lee Jin-man)
A currency trader works near screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea, Thursday, Feb. 7, 2019. Asian shares were mostly higher Thursday on news that the Reserve Bank of Australia may cut interest rates, driving hopes that other central banks could come to the same conclusion. (AP Photo/Lee Jin-man)
A currency trader walks by a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room in Seoul, South Korea, Thursday, Feb. 7, 2019. Asian shares were mostly higher Thursday on news that the Reserve Bank of Australia may cut interest rates, driving hopes that other central banks could come to the same conclusion. (AP Photo/Lee Jin-man)
A currency trader walks by screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room in Seoul, South Korea, Thursday, Feb. 7, 2019. Asian shares were mostly higher Thursday on news that the Reserve Bank of Australia may cut interest rates, driving hopes that other central banks could come to the same conclusion. (AP Photo/Lee Jin-man)

SINGAPORE — Asian shares were mostly higher Thursday on news that the Reserve Bank of Australia may cut interest rates, driving hopes that other central banks could come to the same conclusion. Markets in China, Hong Kong and Taiwan were closed for Lunar New Year.

Philip Lowe, the governor of Australia's central bank, said in a speech on Wednesday that lower interest rates "might be appropriate at some point" if the country's unemployment rate keeps rising and inflation targets aren't achieved.

The central bank kept its official interest rate at a record-low 1.5 percent earlier this week. But it downgraded its 2019 growth forecast for Australia to around 3 percent from 3.5 percent.

"In adopting a more evenly balanced stance, the RBA has opened the door for a rate cut if increased global risks and the weaker housing market forces more downgrades in its sanguine growth or inflation outlook," DBS Group Research strategists Philip Wee and Duncan Tan said in a commentary.

Australia's S&P ASX 200 rebounded 1.1 percent to 6,094.70.

When borrowing is made less expensive, the increase in spending by businesses and consumers could give the economy boost. Central banks in the Philippines, India and the U.K will meet later today but they are expected to leave rates unchanged.

Japan's Nikkei 225 dropped 0.7 percent to 20,736.89 on concerns over U.S.-China relations. U.S. Treasury Secretary Stephen Mnuchin and trade representative Robert Lighthizer will lead a delegation to Beijing next week for the next round of trade talks, but the issues at hand are complex.

These include contentious issues like Beijing's technology policy and trade practices, where progress has been limited so far.

Mnuchin also said that there were no plans for President Donald Trump to meet Chinese leader Xi Jinping. "If there are remaining issues that we can't get closed, I think President Trump expects that he's going to sit down with President Xi and address those issues," he said.

In other trading, New Zealand's NZX index advanced 0.8 percent to 9,914.64 and South Korea's Kospi rose 0.3 percent to 2,209.76. Stocks rose in Singapore and the Philippines but fell in Indonesia.

WALL STREET: Video game companies Electronic Arts, whose titles include "The Sims", and Take-Two Interactive, maker of the "Grand Theft Auto" series, reported weaker-than-expected earnings on Wednesday. They also posted disappointing forecasts because of tougher competition. Communication sector stocks tumbled, snapping the market's five-day winning streak, but strong earnings by other companies cushioned the blow. The broad S&P index lost 0.2 percent to 2,731.61. The Dow Jones Industrial Average fell 0.1 percent to 25,390.30 and the Nasdaq composite dropped 0.4 percent to 7,375.28. The Russell 2000 index of smaller company stocks eased 0.1 percent to 1,518.02.

ENERGY: U.S. crude lost 10 cents to $53.91 per barrel in electronic trading on the New York Mercantile Exchange. It gained 35 cents to settle at $54.01 per barrel in New York. Brent crude, used to price international oils, gave up 18 cents to $62.51 per barrel. It added 71 cents to close at $62.69 per barrel in London.

CURRENCIES: The dollar eased to 109.87 yen from 109.99 yen late Wednesday. The euro weakened to $1.1359 from $1.1363.

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