SINGAPORE - United States Federal Reserve chairman Ben Bernanke sparked a huge rally across Asian bourses yesterday, after indicating that the central bank would not be in a hurry to raise interest rates.
Low interest rates and plentiful easy credit have helped fuel a global stock market boom in recent times, though investors have fretted that they might end soon.
Responding to questions after a speech in Boston on Wednesday, Mr Bernanke put a damper on market talk that the Fed would soon cut its massive bond-buying programme, which has flooded the world with cheap money.
His comments were enough for markets to shrug off recent losses.
In Singapore, the benchmark Straits Times Index (STI) saw its largest one-day gain in 1 ½ years, rising by 60.88 points, or 1.91 per cent, to a five-week high of 3,248.92. The rally added $13 billion to the value of local shares.
Hong Kong's Hang Seng rose 2.55 per cent, South Korea's Kospi added 2.93 per cent and the Thai SET Index gained 4.22 per cent. In Japan, the Nikkei-225 Index inched up 0.39 per cent.
China was the big winner - the CSI 300 Index, which tracks 300 A-shares listed in Shanghai and Shenzhen, surged 4.61 per cent.
On Wall Street, US stocks opened higher - the Dow Jones Industrial Average gained as much as 1 per cent in early trading.
Mr Bernanke also said that a "highly accommodative monetary policy for the foreseeable future is what is needed" and that the current US unemployment rate of 7.6 per cent did not reflect the health of the job market.
Stripped of financial jargon, his words were read to mean that the Fed will not end its bond-buying earlier than expected.