On Wednesday, Asian shares rose as investors hoped that future global interest rate hikes might become less aggressive. Previous policy tightening works to ease price pressures in some of the world’s major economies.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5% after rising in the previous session. The index is down 0.6% so far this month. Australian shares rose 1.35% in early trade, while Japan’s Nikkei rose 0.34%.

Hong Kong’s Hang Seng Index rose 3.76% a day after the public holiday, while markets in mainland China remained closed for the holiday.

The strong start for Australian shares was their first two-day gain since September 13, with stocks posting their best one-day gain in more than two years after the Reserve Bank of Australia ordered a 25 basis point rate hike on Tuesday.

On Wall Street, the Dow and S&P 500 posted their biggest two-day gains in two years as fears of aggressive rate hikes eased.

Positive sentiment was boosted by the biggest drop in US job openings in nearly 2-1/2 years in August, a sign that the Fed’s mandate to curb demand by raising interest rates is working.

However, New Zealand raised interest rates by 50 basis points as expected on Wednesday but said it was considering a 75 basis point hike, a sign that some central banks are still concerned about inflation.

The Dow Jones Industrial Average gained 2.8%, the S&P 500 gained 3.06%, and the Nasdaq Composite gained 3.34%. According to Macquarie’s analysts, the S&P 500 had its third-best start to October since 1930.

The yield on the benchmark 10-year US Treasury note rose to 3.625% from Tuesday’s US close of 3.617%. Two-year Treasury yields rose as traders expected the federal funds rate to rise to 4.0905%, compared with a US close of 4.097%. USD/JPY was down 0.21% to 143.79.

The euro was down 0.1% on the day at $0.9974, up 1.79% in a month, while the US dollar index, which tracks the greenback against a basket of other major trading partners, was lower, having lost nearly 4% since September 26.
US crude fell 0.15% to $86.39 a barrel. Brent crude fell by $91.80 a barrel. Gold edged lower. Spot gold was trading at $1,724.6667 an ounce.