ASIAN STOCK ON RISE AFTER FED DOVISH TALK

Asian shares started the week with gains and the dollar was not far off two-week lows after U.S. Federal Reserve Chairman Jerome Powell struck a more dovish tone than some investors expected in long-awaited speech on Friday.

Investors had been waiting to see whether Powell, who was speaking at a symposium in Jackson Hole, Wyoming, would give a clear indication of his views on timing of the central bank's tapering of asset purchases or hiking interest rates to start removing monetary stimulus. However, in his prepared remarks, he offered no indication on cutting asset purchases beyond saying it could be "this year", causing the S&P 500 (.SPX) and the Nasdaq (.IXIC) to close last week at new record highs.

THE NIKKEI 225 went up 148 points or 0.54% to close at an over two-week high of 27,789 on Monday, as traders welcomed reports that retail sales in Japan grew more than estimated in July. Risk appetite was also lifted by US Fed Chair Jerome Powell's statement at the Jackson Hole symposium that eased fears about a fast exit of huge stimulus. On the pandemic front, Japan's top government spokesman said today that there was not enough data yet to promote the mixed-use of COVID-19 vaccines. Meantime, the country's total virus was recorded at 1.46 million as of Monday morning. Investors now look toward the release of Japan's jobless rate for July and preliminary industrial output data for the month on Tuesday. Nippon Steel Corp soared 5.27%, while Dowa Holdings climbed 5.25%.

THE SHANGHAI COMPOSITE INDEX was up 12 points or 0.34% to 3,534 in early deals on Monday after closing 2.8% higher last week, amid optimism that policymakers will continue to support China's economic recovery. The PBoC has injected a net CNY 120 billion into the banking system at the end of August, the largest weekly injection since the start of February. Earlier this month, the central bank left its key interest rates steady for a 16th straight month, as widely expected. In the US, Fed Chair Powell during the speech at the Jackson Hole symposium indicated that a reduction in asset purchases will not carry a direct increase in interest rates. In recent data, US personal income and spending continued to rise in July and core PCE inflation eased for a 2nd straight month. On the pandemic side, China saw 23 new infections on Sunday, down from 33 a day earlier. In Hong Kong, stocks were also higher, rising for the 2nd straight session, mainly lifted by shares of energy and healthcare.

THE BSE SENSEX climbed 507 points or 0.9% to a fresh record high at 56,629 around midday on Monday, after Fed Chair Jerome Powell laid out a slower-than-expected path to rate hikes in the US. News that India attracted FDI inflows of $22.53 billion during the first three months of the FY starting on April 1st, 90% higher than the same period last year, also buoyed sentiment. On the pandemic side, India has now administered 628 million vaccine doses, as vaccinations accelerated thanks to the Serum Institute of India that is making about 150 million doses a month of its version of the AstraZeneca vaccine. Traders now anticipate the release of India's Q2 GDP data on Tuesday, with market expected the economy to have expanded at a record pace, due to a rebound in consumer spending and a weak base last year. Bharti Airtel jumped 1.5% after saying it plans to raise up to INR 210 billion through a sale of shares to existing shareholders, as it prepares the launch of 5G services.

The next big event on traders' calendars is U.S. nonfarm payroll figures for August due to be published Friday, as Powell has suggested an improvement in the labour market is one major remaining prerequisite for action. A strong payrolls print could instigate a debate for a September tapering start. The absence of a timetable for tapering caused U.S. benchmark Treasuries and the dollar to slip, and both trends continued on Monday morning in Asia.

The yield on benchmark 10-year Treasury notes was 1.3054% compared with its U.S. close of 1.312%, and the dollar index which measures the greenback against a basket of currencies was around a two week low.

Oil was also in focus after energy firms suspended 1.74 million barrels per day of oil production in the U.S. Gulf of Mexico as Hurricane Ida slammed into the Louisiana coast as a Category 4 storm. U.S. crude rose 0.86% to $69.34 a barrel. Brent crude rose 1.25% to $73.38 per barrel. Gold was slightly higher, with the spot price gold was traded at $1,817.7863 per ounce, up 0.07%.