Asian Markets Mostly Higher After Wall Street Rally

asiancommentary dec27 25jun20 lt

Asian stock markets are mostly higher on Friday following the positive cues overnight from Wall Street after U.S. regulators announced plans to ease regulations that will allow banks to invest in risky assets such as venture capital funds. The news helped offset worries about the spiking coronavirus cases in a number of U.S. states.

However, the Federal Reserve later ordered U.S. banks to cap dividend payments and suspend share buyback programs following the release of its annual stress test results.

The Australian market is advancing, with the benchmark S&P/ASX 200 Index adding 52.80 points or 0.91 percent to 5,870.50, off a high of 5,880.90 earlier. The broader All Ordinaries Index is higher by 53.60 points or 0.90 percent to 5,981.60. Australian stocks hit their lowest level in more than a week on Thursday.

The big four banks are notably higher, following the gains by their U.S. peers overnight. ANZ Banking, Westpac, National Australia Bank and Commonwealth Bank are higher in a range of 1.9 percent to 2.5 percent.

Oil stocks are advancing after crude oil prices rose almost 2 percent overnight. Oil Search and Woodside Petroleum are higher by more than 1 percent each, while Santos is rising 0.6 percent.

Among the major miners, BHP is rising more than 1 percent, Fortescue Metals is adding almost 1 percent and Rio Tinto is up 0.6 percent.

Gold miners are also higher even as gold prices declined for a second straight session overnight. Evolution Mining and Newcrest Mining are adding 0.5 percent each.

Qantas Airways said it has raised A$1.36 billion from institutional investors as part of a A$1.9 billion share sale and will raise another A$500 million through a share purchase plan for retail investors. The airline's shares are losing almost 9 percent.

In the currency market, the Australian dollar is higher against the U.S. dollar on Friday. The local unit was quoted at $0.6880, compared to $0.6865 on Thursday.

The Japanese market is rising, with the benchmark Nikkei 225 Index adding 199.43 points or 0.90 percent to 22,459.22, after touching a high of 22,494.77 earlier. Japanese shares closed lower on Thursday.

Market heavyweight SoftBank Group is rising more than 2 percent and Fast Retailing is adding 0.3 percent.

In the financial sector, Aozora Bank, Sumitomo Mitsui Financial Group, Mitsubishi UFJ and Resona Holdings are all higher by almost 2 percent each, following the gains by their U.S. counterparts overnight.

The major exporters are mostly higher on a weaker yen. Panasonic is advancing more than 1 percent, while Canon and Mitsubishi Electric are advancing almost 1 percent each. Sony is down 0.3 percent.

In the tech space, Tokyo Electron is rising almost 2 percent and Advantest is higher by more than 1 percent. Among automakers, Toyota is up more than 1 percent, while Honda is edging down 0.1 percent.

In the oil sector, Japan Petroleum is lower by more than 1 percent and Inpex is declining almost 1 percent even as crude oil prices rose almost 2 percent overnight.

Among the major gainers, Fujitsu is rising more than 4 percent, while FamilyMart and Nomura Holdings are gaining almost 4 percent each.

On the flip side, SkyPerfect JSAT Holdings is lower by more than 3 percent, while Nippon Sheet Glass and Rakuten are losing more than 2 percent each.

In economic news, the Ministry of Internal Affairs and Communications said that overall consumer prices in the Tokyo area were up 0.3 percent on year in June. That missed expectations for an increase of 0.6 percent on year and was down from 0.4 percent in May.

Core CPI, which excludes volatile food prices, rose 0.2 percent on year - in line with expectations and unchanged from the May reading.

In the currency market, the U.S. dollar is trading in the lower 107 yen-range on Friday.

Elsewhere in Asia, South Korea and Singapore are higher by almost 1 percent each, while New Zealand is modestly higher. Indonesia and Malaysia are edging higher, while Hong Kong is lower. The markets in Taiwan and China are closed on Friday for the Dragon Boat Festival.

On Wall Street, stocks closed higher on Thursday, reflecting strength among financial stocks came amid news U.S. regulators plan to ease banking regulations, including allowing banks to more easily make investments in riskier funds such as venture capital funds. Traders were also looking ahead to the release of the results of the Federal Reserve's stress tests after the close of trading.

The Dow shot up 299.66 points or 1.2 percent to 25,745.60, the Nasdaq jumped 107.84 points or 1.1 percent to 10,017.00 and the S&P 500 surged up 33.43 points or 1.1 percent to 3,083.76.

The major European markets moved to the upside on Thursday. While the French CAC 40 Index jumped by 1 percent, the German DAX Index advanced by 0.7 percent and the U.K.'s FTSE 100 Index rose by 0.4 percent.

Crude oil prices moved higher on Thursday, recovering from losses in the previous two sessions, despite continued concerns about energy demand outlook in the wake of reports showing a surge in new coronavirus cases. WTI crude for August delivery rose $0.71 or 1.9 percent to $38.72 a barrel.

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