Asian stocks rise after Fed chair supports smaller rate hike

BEIJING (AP) — Asian stock markets rebounded Thursday and oil prices climbed higher after the head of the Federal Reserve said he supports a smaller rise in interest rates than some expected.

Shanghai, Tokyo, Hong Kong and Sydney advanced even as Russian forces whose attack on Ukraine has roiled financial markets bombarded the country's second-largest city, Kharkiv, and besieged two ports.

Wall Street's benchmark S&P 500 index rose 1.9% on Wednesday, recovering this week's losses after Fed Chair Jerome Powell said the U.S. central bank is set to raise its key interest rate for the first time since 2018. He said he supports a traditional rate hike of 0.25 percentage points instead of the bigger rise recommended by some policymakers.

Powell said the impact on the U.S. economy of Russia's attack is “highly uncertain.”

“Markets have reacted positively to the remarks, which is a debatable interpretation of Powell’s nuanced comments,” ING economists said in a report. “Volatility is the key here, and uncertainty. This isn’t going to go away any time soon.”

The Nikkei 225 in Tokyo rose 0.8% to 26,605.94 and the Hang Seng in Hong Kong gained 0.5% to 22,453.50. The Shanghai Composite Index advanced 0.1% to 3,487.54.

The Kospi in Seoul added 1.5% to 2,743.37 and Sydney's S&P-ASX 200 was 0.7% higher at 7,164.00.

India's Sensex opened up less than 0.1% at 55,500.49. New Zealand and Southeast Asian markets also advanced.

Share prices have swung widely as investors try to figure out how the Russian attack will affect supplies of oil, wheat and other commodities and the global recovery from the coronavirus pandemic.

Traders already were uneasy about plans by the Fed and other central banks to fight inflation by withdrawing ultra-low interest rates that boosted stock...