Global stocks rise after Fed, Japan leave rates unchanged

Singapore-based DBS Bank's analysts said in a note to clients on Thursday that the markets reacted "well to the Fed hold and the BOJ tweak".

"Initial USD weakness was met with some better buying as the session grew and this seems to have taken some of the heat out of further risk sentiment", wrote Chris Weston, chief market strategist at IG in Melbourne.

The Fed also slowed the pace of future hikes and cut its longer run interest rate forecast, but sent a strong signal for a move by the end of this year.

Overnight US stocks surged on the back of the Fed's decision, particularly sending the dividend-paying stocks higher.

But the language in the post-meeting statement issued by the Fed's Open Market Committee and the economic projections of the committee's members pointed in different directions. Real estate companies rose as investors, comfortable that interest rates would remain low, looked for income.

"The statement is much more hawkish than I thought it would be", said Stephen Stanley, chief economist at Amherst Pierpont Securities in NY, who said he expects a rate increase in December. Under typical conditions, keeping interest rates low can spur business growth and thus lower the unemployment rate while risking higher inflation.

The Dow Jones industrial average closed up 163.74 points, or 0.9 per cent, to 18,293.7, the S&P 500 gained to finish 23.36 points, or 1.09 per cent higher, to 2,163.12, while the Nasdaq Composite ended up 53.83 points, or 1.03 per cent, to close at 5,295.18, a record high.

Australian shares rose 0.9 percent, while South Korea's KOSPI advanced 1 percent.

The dollar index, which measures the greenback's value against a basket of six major currencies, touched a low of 95.373 at one point on Thursday, its weakest level since September 16.

Toronto market posts triple-digit gain as oil and USA markets rise
The Toronto Stock Exchange's S&P/TSX composite index unofficially closed down 99.25 points, or 0.67 percent, at 14,697.93. Canada and China settled a trade dispute and said they would start exploratory talks on a free trade pact.

The yen was on track to finish higher on the week against the dollar and the euro.

"The Fed and central banks worldwide have been providing investors with a sense of calm and complacency".

This is similar to what the Central Bank of Nigeria did Tuesday, when it was widely expected that the bank would reduce rates in line with the expectation of the finance ministry.

The decision comes as little surprise as the market was pricing in an nearly 90% chance the Fed would leave rates on hold.

In commodities, oil prices extended gains after data showed USA crude stocks fell sharply last week. FED chair Yellen said the economy can still grow at the current rate.

Shares of FedEx jumped, up 6.8 per cent as of 3.08pm in NY, after the shipping company upgraded its full-year earnings forecast, and offered an upbeat outlook on the impact of its acquisition of TNT Express. United States crude futures jumped 2.5 per cent to $45.12 a barrel, while Brent crude futures were up 1.8 per cent at $46.72.

Maybe that remains the case, but central banks around the world are facing questions about the continued effectiveness of loose policy given that in many markets interest rates are already ultra-low or in negative territory. Last time the RBNZ said that it believed "further policy easing will be required".

Oil prices rose about 1.6 percent as the dollar fell and US crude inventories recorded a surprise drop. At 10:11 a.m. HK/SIN, the kiwi was fetching $0.7333.

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