Chinese stocks were up in early trade as other Asian markets also followed. CNBC reported that the Asian stocks started trading higher in the morning after US Federal Reserve chairman Jerome Powell said that the US central bank is open to cutting interest rates very soon. Powell added that FOMC participants were also given a glimpse of a "more accommodating" monetary policy.
The Shanghai composite traded at 0.82% while the Shenzhen component, along with the Shenzhen composite, traded at 1% higher than before. Hong Kong's Hang Seng index, meanwhile, traded at an advance of 1.2%. The Nikkei 225 was at 0.3% during the morning, while the Topix posted a rise of around 0.36%.
Game maker Nintendo went on a killing, trading somewhere around 3.5% higher after the company came out with an announcement about their new Switch video game console. South Korea's Kospi climbed to 1.16% in the trading, while Australia's S&P/ASX 200 posted a trade gain of 0.25% higher.
This didn't mean that Tokyo and Seoul were already trading warmly. Japan said it would continue to tighten restrictions on Korean exports used for smartphone displays and chips. Japan and South Korea entered into a trade dispute of their own over allegations of South Koreans being forced to work for the Japanese during the Second World War.
Everywhere in Asia, shares rose as local investors flocked to trade after the US announced lowering interest rates. According to Market Watch, the dollar is weaker is another reason why the Asian shares managed to rebound. Stephen Innes of Vanguard Markets shared this fact through a commentary on the state of Asian shares.
On the side of Wall Street, technology stocks gained much, nudging the Nasdaq composite into a record high. The S&P 500 index made some history of its own, trading above 3,000 for the first time, before coming back to just below its recent record high, completed just a week ago.
The markets behaved as such after Powell informed the Congress during his semi-annual report that many Fed officials think that the weakening global economy-combined with rising trade tensions from countries with ongoing trade disputes-necessitate the need for an interest rate cut.
If there are unfortunate fruits of a trade dispute-the main one being the dispute between the US and China-this is, by far, one of the positives of a dispute. The US rate cuts might continue depending on how the trade dispute will end, or how the US dollar rebounds.
