Hang Seng Boosted By Wall St Tech, Weak Yen Lifts Nikkei

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Asia’s major stock indexes advanced on Tuesday as a tech-led Wall Street rally buoyed the mood across the region.

Investors were betting on earnings reports due out from US technology giants including Meta Platforms, Alphabet and Microsoft later in the week, while a still strong dollar pressured the Japanese yen to fresh 34-year lows.

That saw Japan’s Nikkei share average rise, although concerns about tensions in the Middle East capped those gains.

 

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The Nikkei share average edged up 0.30%, or 113.55 points, to close at 37,552.16, notching a second consecutive session of gains after slumping to a 10-week low on Friday. The broader Topix was ahead 0.14%, or 3.77 points, to 2,666.23.

Utilities were also winners, with Osaka Gas jumping 4.84% to be the Nikkei’s biggest percentage gainer after revising up its earnings forecast. Tokyo Gas climbed 2.79%.

China stocks, however, slipped, dragged by cyclical shares such as metals, while technology companies boosted Hong Kong shares. 

Non-ferrous metals companies led the declines in China, sliding 3.4%, while coal-related stocks dropped 1.3%.

China’s blue-chip CSI300 index was down 0.70% with, earlier in the session, its financial sector sub-index higher by 0.57%, the consumer staples sector up 0.81%, the real estate index down 0.79% and the healthcare sub-index down 0.55%.

The Shanghai Composite Index lost 0.74%, or 22.62 points, to 3,021.98, while the Shenzhen Composite Index on China’s second exchange slipped 0.19%, or 3.22 points, to 1,675.05.

Chinese H-shares – belonging to companies from the Chinese mainland – listed in Hong Kong rose 1.85% to 5,939.12, while the Hang Seng Index was up 1.89%, or 311.35 points, at 16,823.04.

Elsewhere across the region, in earlier trade, most of Asia followed Wall Street’s lead, extending their advances. Sydney, Mumbai, Singapore, Taipei, Manila and Jakarta all saw buying action but Seoul and Wellington struggled. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.97%.

 

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Europe looked set for a higher open, with Eurostoxx 50 futures up 0.5%. US stock futures, however, slipped 0.1%.

On Wall Street, big tech shares outperformed ahead of their quarterly results this week, sending the Nasdaq 1.1% higher. AI darling Nvidia gained 4.4% while Amazon.com rose 1.5% and Alphabet jumped 1.4%, although Tesla dropped 3.4% as it cut prices in its major markets.

In addition to top corporate earnings, markets are also awaiting the release later this week of the US gross domestic product figures and the March personal consumption expenditure data – the Fed’s preferred inflation gauge – to further ascertain the trajectory of monetary policy.

Traders now expect the first Fed rate cut would most likely come in September, while the total easing expected this year would just be 40 basis points, a sea change from about 150 bps of cuts priced in at the beginning of the year.

The drastic shift in interest rate expectations has seen the two- and 10-year US Treasury yields both rising almost 100 bps from recent lows.

On Tuesday, they were little changed amid a lack of data and news, with two-year yields holding at 4.9762% and 10-year yield at 4.6127%.

The beleaguered yen kept hitting fresh 34-year lows. It was flat at 154.78 per dollar, after plumbing another fresh low of 154.85 overnight.

Risk of intervention remains high after Japan finance minister Shunichi Suzuki said last week’s trilateral meeting with his US and South Korean counterparts laid the groundwork for Tokyo to take appropriate action in the foreign exchange market.

Oil prices recovered some of the sharp losses overnight as investors continued to assess the situation in Middle East. Futures rose 0.4% to $87.34 a barrel, while gained 0.4% to $82.25 a barrel.

Gold prices, however, lost 0.8% to $2,295.9 per ounce, after slumping 2.7% overnight as safe-haven bids continued to unwind.

 

Key figures

Tokyo – Nikkei 225 > UP 0.30% at 37,552.16 (close)

Hong Kong – Hang Seng Index > UP 1.89% at 16,823.04 (close)

Shanghai – Composite < DOWN 0.74% at 3,021.98 (close)

London – FTSE 100 > UP 0.37% at 8,053.86 (0911 BST)

New York – Dow > UP 0.67% at 38,239.98 (Monday close)

 

Reuters with additional editing by Sean O’Meara

 

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Markets, Hang Seng Index, Nifty 50, Nikkei 225