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Asian Shares Climb On Brexit Deal Hopes

stockmarkets dec21 16oct19 lt

Asian stocks moved mostly higher on Wednesday, with a solid start to the U.S. earnings season and expectations that Britain still has a chance of avoiding a messy exit from the European Union helping boost investor sentiment.

According to media reports, European Union and U.K. negotiators were closing in on a draft Brexit deal.

However, China's Shanghai Composite Index fell 12.33 points, or 0.4 percent, to 2,978.71 on worries that the phase one trade deal could be unraveling.

China's bank lending increased in September, data from the People's Bank of China said in a report. Bank lending increased to CNY 1.69 trillion in September from CNY 1.21 trillion in August. The expected level was CNY 1.4 trillion.

Meanwhile, Hong Kong's Hang Seng Index climbed 160.35 points, or 0.6 percent, to 26,664.28 despite signs of fresh U.S.-China tensions over Hong Kong.

Hong Kong Chief Executive Carrie Lam said the city has slipped into a technical recession since a series of protests began rocking the city in June.

Japanese shares hit over 10-month highs after the Bank of Japan's Regional Economic Report said that all nine regions across Japan had been either expanding or recovering,

The Nikkei 225 Index jumped 265.71 points, or 1.2 percent, to 22,472.92, as a weaker yen lift exporters. Chipmaking-related companies also followed their U.S. peers higher. The broader Topix closed 0.7 percent higher at 1,631.51, its highest level in more than 10 months.

Automakers Honda Motor, Toyota Motor and Nissan Motor rose around 1 percent as the yen hit a 2-1/2 month low of 108.90 yen against the greenback on hopes of an orderly British exit from the European Union.

Advantest jumped 2.7 percent and Screen Holdings added 2.9 percent after the U.S. Philadelphia Semiconductor Index hit a record high.

Australian markets extended their winning streak to a fifth day, with heavyweight bank stocks leading the surge. The benchmark S&P/ASX 200 Index spiked 84.50 points, or 1.3 percent, to 6,736.50, while the broader All Ordinaries Index surged up 79.90 points, or 1.2 percent, to 6,843.20.

The big four banks rose between 1 percent and 1.5 percent, while energy stocks such as Woodside Petroleum, Santos, Origin Energy and Oil Search gained between 0.7 percent and 1.3 percent.

Industrial engineering company WorleyParsons jumped 4 percent after it asked the Foreign Investment Review Board to look at "possible creeping acquisitions" by its biggest shareholder, Dubai-based Dar Group.

On the other hand, miners closed lower as higher third quarter output from Brazilian miner Vale SA pulled down Chinese iron ore prices to an over two-week low.

Rio Tinto shed 0.9 percent despite the company affirming its outlook for full-year Pilbara shipments. Gold miner Evolution lost 3 percent as risk aversion ebbed.

South Korea's Kospi rose 0.7 percent as the country's central bank lowered its key interest rate, as expected, and left the door open for further easing due to the continued U.S.-China trade dispute and escalating geopolitical risks.

New Zealand shares rose for a fourth straight session, with the benchmark S&P NZX-50 index climbing 133.30 points, or 1.2 percent, to 11,178.64.

Restaurant Brands New Zealand surged 4.2 percent after the company said it anticipates net profit after tax to be at least 10 percent higher next year.

Consumer prices in New Zealand climbed 0.7 percent sequentially in the third quarter of 2019, Statistics New Zealand said today - surpassing expectations for an increase of 0.6 percent, which would have been unchanged from the previous three months.

U.S. stocks finished at more-than-three-week highs overnight as investors cheered upbeat earnings results from the likes of JPMorgan Chase, UnitedHealth, Citigroup and Johnson & Johnson.

The Dow Jones Industrial Average rose 0.9 percent, the tech-heavy Nasdaq Composite climbed 1.2 percent and the S&P 500 added 1 percent.

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