EQUITIES

Shares in Asia-Pacific advanced during Thursday trade, as markets appeared to breathe a sigh of relief following the Fed’s rates hike.

Mainland Chinese stocks were in positive territory after returning from a three-day break. The Shanghai composite gained 0.70% while in Hong Kong, the Hang Seng index climbed 0.43%. In Australia, the S&P/ASX 200 climbed 0.82%.

Markets in Japan and South Korea are closed on Thursday.

European markets also set to climb as it opens later today, tracking global sentiment.

OIL

Oil extended gains on Thursday after the European Union, the world's largest trading bloc, spelled out some of the details of its plan to phase out imports of Russian oil, heightening concerns about supply, offsetting demand worries in top importer China.

European Commission President Ursula von der Leyen proposed a phased oil embargo on Russia over its war in Ukraine. The sanctions proposal will need unanimous backing by the 27 EU countries to take effect. It also proposes to ban in a month's time all shipping, brokerage, insurance, and financing services offered by EU companies for the transportation of Russian oil.

Brent crude futures climbed 0.14% to $110.37 a barrel, while U.S. WTI crude futures rose 0.73% to $108.33 a barrel. Both benchmarks jumped more than $5 a barrel on Wednesday.

CURRENCIES

The dollar index was at 102.789, toppled from near a two-decade high of 103.63 overnight in the wake of the Fed decision. It hovered through an Asia session thinned by a holiday in Japan.

U.S. Treasuries were not trading because of the holiday in Japan but yields also fell overnight. The benchmark 10-year yield was last 2.940%, down from just over 3%.

The dollar's losses gave support to cryptocurrencies. Bitcoin had its best day in more than five weeks, rising 5% to sit just below $40,000.

Hong Kong hikes benchmark rate again after tightening by U.S. Fed. The Hong Kong Monetary Authority (HKMA) raised its benchmark interest rate by 50-bps. The HKMA’s base rate was increased to 1.25% from 0.75%, it said in a statement on its website on Thursday. Monetary policy in the city moves in lockstep with the Fed since the Hong Kong dollar is pegged to the US currency.

GOLD

Gold prices climbed on Thursday. Spot gold was up 0.7% at $1,895.10 per ounce, and U.S. gold futures rose 1.5% to $1,896.50.

Spot silver climbed 1.1% to $23.19 per ounce, platinum firmed 0.6% to $997.19, and palladium gained 0.8% to $2,274.43.

ECONOMIC OUTLOOK

Equities market advanced during Thursday trade, as it appeared to breathe a sigh of relief following the Federal Reserve’s rates hike decision.

Stocks rallied and Treasury yields fell after the Fed raised interest rates by 50 basis points as expected and said it would begin to reduce its balance sheet in June, in a decision seen as less hawkish than some feared. Fed’s 50-bps hike was in line with expectations, hence removing some investor concerns about a more aggressive move. Fed Chair Jerome Powell emphasized the commitment to bringing inflation down, though he said a 75-bps hike is “not something the committee is actively considering.”

However, some volatility remains, as market continue to grapple with the geopolitical tensions, the ongoing COVID-19 issues as well as these wide-ranging corporate earnings results.

The war in Ukraine remains on investors’ radar. Russian forces have reportedly renewed their assault on the Azovstal steelworks complex, a last stronghold for Ukrainian fighters in the southern port city of Mariupol.

China’s services sector activity shrunk further in April, contracted at the second-steepest rate on record under the effect of pandemic measures, a private sector survey showed Thursday. The Caixin services PMI declined to 36.2 for April, lower than March’s reading of 42.

Crude prices, meanwhile, shot up as the European Union spelled out some of the details of its plan to ban the use of Russian oil, heightening concerns about supply.

Focus in Europe on Thursday will turn to the Bank of England, which is expected to announce a fourth consecutive interest rate hike to combat soaring prices.