EghtesadOnline: Asian stocks followed advances in U.S. and European equities as the prospects of faster U.S. economic growth propelled markets toward the close of a turmoil-filled year. Oil extended its advance and the yen climbed.
Stock gauges from New Zealand to Hong Kong advanced after the Dow Jones Industrial Average closed at a record and the Stoxx Europe 600 Index reached its highest level this year. The yen gained after reaching the weakest since February versus the dollar on Tuesday. Oil traded above $53.5 a barrel as data showed U.S. stockpiles declined last week, Bloomberg reported.
Investors are focusing on the likelihood of increased U.S. government spending that has buoyed equities and pummeled bonds since Donald Trump won the Nov. 8 presidential election. Traders shrugged off geopolitical concerns following the killing of Russia’s envoy to Turkey and a separate attack that left 12 people dead in Berlin. Volumes are thinning and swings in global equities are muted, with a volatility gauge for European stocks at the lowest since 2014.
“Noteworthy is the resilience of equity markets and low volatility in the face of two horrific terrorist attacks in Europe,” Jason Wong, a currency strategist at Bank of New Zealand in Wellington, wrote in a note to clients Wednesday. “They seem to have had little impact on the market.”
- The MSCI Asia Pacific Index advanced 0.2 percent as of 2:27 p.m. in Tokyo, paring back some of Tuesday’s losses.
- Hong Kong’s Hang Seng Index increased 0.6 percent, ending a four-day losing streak that brought the index to a five-month low.
- The Shanghai Composite Index rose 1 percent as Chinese stocks climbed from a six-week low.
- Japan’s Topix Index dropped 0.5 percent. The gauge climbed as much as 0.5 percent earlier after the Bank of Japan signaled it remains committed to easy monetary policy.
- Australia’s S&P/ASX 200 Index and New Zealand’s S&P/NZX 50 Index gained at least 0.2 percent, with Sydney shares at the highest in more than a year.
- South Korea’s Kospi index was little changed.
- Volumes were down across Asia, with trading in Hong Kong about 30 percent below the 30-day average.
- Futures on the S&P 500 Index were little changed. The gauge rose 0.3 percent to 2,266.5 on Tuesday, a point below its all-time high. The Dow closed at an unprecedented 19,974.62
- The Bloomberg Dollar Spot Index fell 0.1 percent after climbing for two straight days. The measure’s gain for the quarter is 7.4 percent, heading for the biggest three-month advance since the third quarter of 2008
- The yen was up 0.3 percent to 117.55, after falling 0.7 percent on Tuesday
- Yields on 10-year Treasury notes fell less than 1 basis point to 2.57 percent, after gaining two basis points Tuesday to pare the previous day’s drop of five basis points
- Yields on Australian 10-year bonds slid two basis point to 2.82 percent, while those in New Zealand increased 1 basis point to 3.44 percent
- Gold rose 0.3 percent to $1,135.92 an ounce, after closing near a 10-month low Tuesday as concerns eased over geopolitical events that had briefly supported the price.
- Oil climbed 0.4 percent to $53.49 in New York. Crude inventories dropped by 4.15 million barrels, the American Petroleum Institute was said to report. Data from the Energy Information Administration on Wednesday is also forecast to show supplies shrank.