Asian equities rose on Thursday after a weaker-than-expected reading on U.S. economic growth reinforced expectations that the Federal Reserve will not raise interest rates anytime soon.
The U.S economy contracted 2.9 percent annually in the first quarter, a much steeper pace than expected, which briefly sent yields on the benchmark 10 year-note to a three-week low. Separately, May durable goods orders unexpectedly declined 1 percent on month while the services sector expanded at its fastest clip in more than four years in June.
"Between the rise in service and manufacturing activity, GDP growth is set for a strong rebound in Q2. Unfortunately the Federal Reserve will want to see how the economy performs in Q3 before getting excited about the recovery. So at the end of the day, the latest economic reports simply validate the central bank's steady and conservative monetary policy stance," said Kathy Lien, managing director of FX strategy for BK Asset Management.