Asia stocks jump as Fed rate hike expectations shift again

SEOUL, South Korea (AP) - Asian stocks markets jumped Tuesday as investors second guessed what signals the Federal Reserve will give on interest rate hikes at its policy meeting this week.

KEEPING SCORE: Japan's Nikkei 225 rose 0.9 percent to 19,411.57 and South Korea's Kospi jumped 1.5 percent to 2,017.19. Hong Kong's Hang Seng was up 0.3 percent to 24,023.69 and China's Shanghai Composite added 0.8 percent to 3,475.77, extending its gain from the previous session. Stocks in Australia and Southeast Asia were also higher.

FED WATCH: Whether the Fed will drop the word "patient" in describing its timetable for raising interest rates from a record low is the focal point for investors this week. IG market strategist Evan Lucas said "all but half a handful of economists" expect the word to be removed from the statement the Fed will issue on Wednesday. But estimates of when the first rate hike will come are swinging between mid-year and later in the year. Weak U.S. economic data Monday pushed expectations toward later in the year. Last week, strong U.S. jobs had many picking mid-year. Stock markets have been boosted for several years by low interest rates.

US DATA: Industrial production growth last month was lower than expected while factory output fell for a third month, casting doubt on the strength of the U.S. recovery. Industrial production edged up slightly in February as a big surge by utilities as a cold winter offset a third straight decline in factory output. The Federal Reserve also reported that output at U.S. factories fell 0.2 percent last month following a decline of a 0.3 percent in January, in part due to a stronger dollar.

ANALYST'S TAKE: "Weaker U.S. industrial and manufacturing data sparked strong rallies in shares as investors and traders speculated interest rate rises may be pushed back," Michael McCarthy, chief market strategist at CMC Markets, said in a commentary.

CHINA CHEER: Chinese stocks extended gains a day after the market's key index surged to its highest level in more than five years. The rally was driven by hopes the government will announce new economic stimulus after Premier Li Keqiang said on the weekend it has plenty of room and options for boosting growth.

WALL STREET: On Monday, U.S. stocks bounced back after losing ground for three weeks as the dollar's rally against the euro abated. The Standard & Poor's 500 rose 1.4 percent to 2,081.19. The Dow Jones industrial average climbed 1.3 percent to 17,977.42. The Nasdaq composite jumped 1.2 percent to 4,929.51.

ENERGY: Oil continued its decline after hitting a six-year low on supplies outpacing demand. Benchmark U.S. crude was down 9 cents to $43.79 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 96 cents to close at $43.88 a barrel on Monday. Brent crude, a benchmark for international oils, added 20 cents to $54.14 in London.

CURRENCIES: In currency trading, the euro weakened slightly to $1.0571 from $1.0578. The dollar inched up to 121.43 yen from 121.37 yen.