Asian shares, US futures advance after Biden speech

Asian shares rose Thursday and U.S. futures also were higher after President Joe Biden delivered a speech to Congress outlining ambitious plans for jobs- creating spending on early education, child care and other public services.

Investors have stayed on the sidelines ahead of the release later in the day of U.S. growth data for the January-March quarter. The gross domestic product reading, could top 5% and accelerate even more to 10% or even more in the current April-June quarter as pent-up demand fuels spending.

Shares rose in Hong Kong, Shanghai, Seoul and Sydney. Bond yields held steady while oil prices advanced.

Benchmarks on Wall Street slipped Wednesday after the Federal Reserve said it is leaving its key interest rate unchanged near zero, while noting recent improvement in the economy.

In his speech Wednesday evening, the president ticked off details of some of his plan for $1.8 trillion in spending to expand preschool, create a national family and medical leave program, distribute child care subsidies and more.

The plan comes on top of his proposal for $2.3 trillion in spending to rebuild roads and bridges, expand broadband access and launch other infrastructure projects.

The future for the Dow industrials rose 0.4% while that for the S&P 500 climbed 0.6%.

In Asian trading, markets in Japan were closed for a holiday. Hong Kong’s Hang Seng rose 0.6% to 29,245.26 and the Shanghai Composite index picked up 0.3% to 3,465.98. In Seoul, the Kospi gained 0.1% to 3,184.78. Australia’s S&P/ASX 200 added 0.4% to 7,082.80.

In its latest policy update, the U.S. central bank left its benchmark short-term rate near zero, where it’s been since the pandemic erupted nearly a year ago, to help keep loan rates down to encourage borrowing and spending. It also said that it would keep buying $120 billion in bonds each month to try to keep longer-term borrowing rates low.

The yield on the 10-year Treasury, which influences interest rates on mortgages and other consumer loans, eased following the Fed’s statement, slipping to 1.61% from 1.62% late Tuesday.

Stocks initially got a bump following the 2 p.m. Eastern release of the Fed’s statement.

The S&P 500 dropped 3.54 points to 4,183.18. The benchmark index hit an all-time high on Monday. The Dow Jones Industrial Average lost 0.5%, to 33,820.38. The tech-heavy Nasdaq gave up 0.3% to 14,051.03.

Smaller company stocks fared better than the bigger companies. The Russell 2000 index rose 0.1%, to 2,304.16.

Wall Street has been mostly grinding higher in recent weeks, pushing stock indexes to record highs, as the rollout of COVID-19 vaccinations, massive support from the U.S. government and the Fed, and a string of encouraging economic data fuel expectations for a stronger economy and solid corporate profit growth this year.

The expectations for a strong rebound and rising prices for oil, lumber and other commodities have also spurred concerns over inflation and the prospects for higher interest rates. Those worries pushed bond yields higher.

In its remarks, the Fed noted that the economy and job market have “strengthened.” And, while it acknowledged that inflation has risen, the central bank said it sees the increase as transitory. Fed officials have said they want to see inflation exceed their 2% annual inflation target before they’d consider raising rates.

Investors also focused Wednesday on corporate earnings, with dozens of companies reporting their quarterly results.

Google’s parent company, Alphabet, rose 3% after it said its profits doubled from a year earlier. Visa rose 1.5% after reporting solid financial results.

Google’s solid gains helped send communications stocks higher. Oil prices rose and boosted energy company stocks, while technology and health care companies declined.

Investors punished several other companies whose results came up short. Boeing slipped 2.9%, while Spotify sank 12.3% after the music streaming company announced that subscriber growth had slowed more than expected.

Biotechnology company Amgen was among the biggest losers. It fell 7.2% after its first-quarter profits and revenue fell short of analysts’ forecasts.

Facebook rose 5.5% in after-hours trading following the release of its latest earnings after the closing bell. Apple added 3.3% in extended trading after the company’s profit soared in its latest quarter on higher iPhone sales.

In other trading Thursday, benchmark U.S. crude oil rose 18 cents to $64.04 per barrel in electronic trading on the New York Mercantile Exchange. It gained 92 cents to $63.86 on Wednesday. Brent crude, the international standard, advanced 19 cents to $66.97 per barrel.

The U.S. dollar was flat at 108.61 Japanese yen. The euro rose to $1.2135 from $1.2128.