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Asian Markets Mostly Higher

asiancommentary dec19 13jan21 lt

Asian stock markets are mostly higher on Thursday with modest gains following the mostly positive cues overnight from Wall Street amid expectations of additional U.S. stimulus from the incoming Biden administration. Investors shrugged off news that the U.S. House has impeached President Donald Trump for a second time.

The Australian market is advancing in volatile trade following the modest gains on Wall Street.

The benchmark S&P/ASX 200 Index is adding 18.80 points or 0.28 percent to 6,705.40, after touching a low of 6,669.30 in early trades. The broader All Ordinaries Index is higher by 18.30 points or 0.26 percent to 6,972.20. Australian shares fluctuated before closing slightly higher on Wednesday.

Tech stocks are rising after three days of losses. Afterpay is gaining more than 7 percent, WiseTech Global is higher by more than 3 percent and Appen is advancing almost 1 percent.

In the banking sector, Westpac is rising almost 2 percent, ANZ Banking is adding almost 1 percent and National Australia Bank is up 0.6 percent, while Commonwealth Bank is edging lower by 0.1 percent.

Among the major miners, Fortescue Metals is lower by almost 2 percent, Rio Tinto is declining more than 1 percent and BHP Group is down almost 1 percent.

Gold miners are also weak even as gold prices rebounded overnight. Evolution Mining is losing almost 2 percent and Newcrest Mining is lower by 0.6 percent.

Oil stocks are mostly lower after crude oil prices declined overnight. Oil Search is losing 0.7 percent and Santos is down 0.1 percent, while Woodside Petroleum is edging up 0.1 percent.

On the economic front, the Australian Bureau of Statistics said that the total number of building permits issued in Australia advanced a seasonally adjusted 2.6 percent on month in November, coming in at 17,205. That was in line with expectations following the 3.8 percent increase in October.

The Japanese market is notably higher after U.S. stocks rose modestly overnight. Upbeat Japanese core machine orders data also boosted sentiment.

The benchmark Nikkei 225 Index is adding 334.74 points or 1.18 percent to 28,791.33, after touching a low of 28,411.58 in early trades. The Japanese market closed higher for the fifth day on Wednesday.

Market heavyweight SoftBank Group is rising almost 4 percent and Fast Retailing is advancing more than 1 percent. In the tech space, Advantest is gaining more than 3 percent and Tokyo Electron is higher by almost 1 percent, following their U.S. peers higher.

The major exporters are mostly higher on a weaker yen. Mitsubishi Electric and Canon are adding 0.5 percent each and Sony is up 0.3 percent, while Panasonic is declining almost 1 percent.

In the banking sector, Mitsubishi UFJ Financial is rising almost 2 percent and Sumitomo Mitsui Financial is advancing more than 1 percent. Among automakers, Honda and Toyota are down 0.4 percent each.

Among the other major gainers, Taiyo Yuden and Nikon Corp. are rising more than 5 percent each, while Yaskawa Electric and Bridgestone are higher by more than 4 percent each. Screen Holdings is advancing almost 4 percent.

Conversely, Nippon Steel and Mitsui Chemicals are lower by more than 2 percent each.

In economic news, the Cabinet Office said that the value of core machine orders in Japan rose a seasonally adjusted 1.5 percent on month in November, standing at 854.8 billion yen. That beat forecasts for a decline of 6.2 percent following the 17.1 percent spike in October.

The Bank of Japan said that producer prices fell 2.0 percent on year in December - beating expectations for a decline of 2.2 percent, which would have been unchanged from the November reading.

In the currency market, the U.S. dollar is trading in the upper 103 yen-range on Thursday.

Elsewhere in Asia, Singapore, Hong Kong and Malaysia are also higher, while South Korea and New Zealand are edging higher. Shanghai, Taiwan and Indonesia are lower.

On Wall Street, stocks rose modestly on Wednesday, adding to the slim gains posted in the previous session. While the Dow ended the day nearly unchanged, the broader Nasdaq and S&P 500 moved to the upside. The higher close by the Nasdaq and the S&P 500 came as treasuries regained ground following recent weakness, leading to a drop in bond yields that contributed to significant strength among interest rate sensitive stocks such as utilities and commercial real estate stocks.

The Nasdaq climbed 56.52 points or 0.4 percent to 13,128.95 and the S&P 500 rose 8.65 points or 0.2 percent to 3,809.84. Meanwhile, the Dow spent the day lingering near the unchanged line before closing down 8.22 points or less than a tenth of a percent at 13,128.95.

The major European markets closed slightly higher on Wednesday after a volatile session amid uncertainty about near term outlook. Germany's DAX and France's CAC 40 advanced 0.1 percent and 0.2 percent, respectively, while the U.K.'s FTSE 100 ended lower by 0.1 percent.

Crude oil futures ended lower on Wednesday despite data showing a larger than expected drop in crude inventories last week. WTI crude for February settled lower by $0.30 or about 0.6 percent at $52.91 a barrel.

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