Asia stocks rally, early US rate hike unlikely

HONG KONG, May 22  (AFP): Asian markets rose Friday following another record close on Wall Street as the likelihood of a US interest rate hike in the near term dwindled, with Tokyo hitting a new 15-year high.
Chinese shares were again the stand-out performers on hopes that Beijing will announce fresh monetary easing measures after more disappointing economic indicators.
Tokyo reversed a morning sell-off to end 0.30 per cent higher, adding 61.54 points to 20,264.41 -- its best finish since April 2000, while Shanghai surged 2.83 per cent, or 128.17 points, to 4,657.60.
Hong Kong added 1.70 percent, or 469.11 points, to close at 27,992.83.
Seoul closed 1.10 per cent up, gaining 23.29 points to 2,146.10 while Sydney ended flat, edging 2.4 points higher to 5,664.7.
On Wall Street the S&P 500 closed at another all-time high thanks to strong earnings results and a multi-billion-dollar pharma merger.
A disappointing reading on US new home sales indicated the economy was still not firing on all cylinders, which suggests it is not yet ready to absorb a Federal Reserve rate rise from record lows. On Wednesday, minutes from the Fed's April policy meeting showed board members had similar concerns.
The S&P 500 gained 0.23 per cent to another record high, the Nasdaq rose 0.38 percent and the Dow was flat.
"The question of when and how fast the US Fed begins to lift interest rates remains the dominant macro issue for equity markets and will be front of mind for traders," Ric Spooner, chief market analyst in Sydney at CMC Markets, told Bloomberg News.
"Some relief on expectations for Fed tightening may be enough to see bargain hunters start to return in earnest."
With rate hike expectations narrowing the dollar eased to 120.77 yen in Asian trade, from 121.07 yen in New York late Thursday.