U.S. rate hike has mixed impact on Asian markets

U.S. rate hike has mixed impact on Asian markets

HONG KONG (AP): Asian stock closed mixed Wednesday, with some markets depressed by the overnight U.S. interest rate hike and Japanese shares falling on its currency's strength.

In Tokyo, the 225-issue Nikkei Stock Average fell 240.25 points, or 1.33 percent, to 17,855.16. On Tuesday, the average had fallen 0.76 percent.

In Hong Kong, shares fell as the U.S. interest rate increase stirred fears that Hong Kong banks will follow suit.

The blue-chip Hang Seng Index fell 1.1 percent, or 154.74 points, to 13,479.13. The Hang Seng had gained 0.5 percent Tuesday.

Traders focused on the overnight decision by the U.S. Federal Reserve to increase interest rates by a quarter point, worrying that Hong Kong banks may do the same.

Hong Kong's de facto central bank, the Hong Kong Monetary Authority, raised the discount rate by a quarter point, but it won't be clear whether the banks will go along until they meet after the market closes Friday.

Rises in U.S. interest rates often are followed by similar moves in Hong Kong because the Hong Kong dollar is pegged to the U.S. currency, but experts warn this time that higher rates could harm the territory's efforts to climb out of recession.

In Bangkok, prices rallied on huge foreign speculative buying in banking stocks, which had fallen sharply lately, and on news that Thailand would keep interest rates low.

The SET index jumped 4.9 percent, or 22.15 points, to 468.70.

In Kuala Lumpur, Malaysian shares fell, despite widespread market expectations of strong economic growth. The Composite Index closed at 768.43, down 6.75 points, or 0.87 percent.

In Jakarta, Indonesian shares fell slightly after the World Bank threatened to halt aid if the investigation into irregularities in fund transfers at Bank Bali isn't concluded satisfactorily. The JSX Composite Index fell 0.979 point, or 0.2 percent, at 585.257.

In Manila, Philippine shares rose on strong demand for blue chips. The PSE index rose 11.21 points, or 0.5 percent, to 2,260.14.

In Seoul, South Korean shares rallied on hopes that the troubled Daewoo Group could repay its debts soon. The Kospi rose 30.59 points, or 3.3 percent, to 963.00.

In Singapore, Singapore shares rose, led by heavyweight property developer City Developments Ltd. The Straits Times Index rose 16.34 points, or 0.78 percent, to 2,136.36.

In Sydney, Australian shares fell on poor corporate earnings and the U.S. interest rate hike. The All Ordinaries index fell 19.1 points, or 0.6 percent, to 3,033.3.

In Taipei, Taiwan shares rallied as investors bought heavily in semiconductor-related stocks. The Weighted Price Index rose 142.70 points, or 1.8 percent, at 8,127.09.