Asian Shares Mostly Higher On Growth Optimism

stockmarkets jan07 04aug21 lt

Asian stocks rose broadly on Wednesday, as optimism for strong earnings growth and expectations of continued support from central banks offset renewed concerns about the rapid spread of the delta variant of the coronavirus.

Chinese shares advanced after the latest survey from Caixin showed the services sector in the country expanded at a faster rate in July, with a services PMI score of 54.9, up from 50.3 in June. The survey also said its composite index improved to 53.1 from 50.6 in June. The benchmark Shanghai Composite index ended up 29.23 points, or 0.9 percent, at 3,477.22.

Hong Kong's Hang Seng Index jumped 231.73 points, or 0.9 percent, to 26,426.76. Investors shrugged off survey results showing that Hong Kong's private sector expanded at a slower pace in July.

Meanwhile, Japanese shares edged lower after the latest survey from Jibun Bank showed the services sector in the country contracted at a faster rate in July, as companies saw activity hampered by the recent surge in COVID-19 cases.

The Nikkei 225 Index dipped 57.75 points, or 0.2 percent, to 27,584.08 while the broader Topix closed half a percent lower at 1,921.43. Sumitomo Electric Industries, Mitsui Engineering & Shipbuilding and Nichirei Corp lost 6-12 percent.

Australian markets eked out modest gains as higher iron ore prices helped lift miners. The benchmark S&P/ASX 200 Index edged up 28.70 points, or 0.4 percent, to 7,503.20, while the broader All Ordinaries Index ended up 28.20 points, or 0.4 percent, to 7,778.70.

Mining heavyweights BHP and Rio Tinto rose 2.1 percent and 1.5 percent, respectively, as iron ore prices rallied 2 percent on hopes of strong demand. Energy stocks finished broadly higher despite oil prices falling for the third straight day on fuel demand concerns.

Splitit soared more than 23 percent on speculation that the payment solutions provider might be a takeover target.

In economic news, the services sector in Australia fell into contraction territory in July, while retail turnover in June fell 1.8 percent from a month earlier, separate reports showed.

Seoul stocks posted strong gains as tech shares surged on optimism for strong earnings. The benchmark Kospi rallied 43.24 points, or 1.3 percent, to settle at 3,280.38, marking the largest daily gain since May 10.

Naver rose 1.2 percent, Samsung Electronics advanced 1.8 percent and Kakao jumped 3.8 percent. SK Innovation lost 3.8 percent after the petroleum refining company decided to spin off its battery business.

New Zealand shares rose sharply and the kiwi dollar jumped to the highest point in weeks after data showed the overall unemployment rate in the country declined from 4.6 percent in the first quarter to 4.0 percent in the second quarter.

The benchmark NZX-50 Index climbed 96.79 points, or 0.8 percent, to 12,797.29, with A2 Milk and Mainfreight pacing the gainers. Air New Zealand dropped 0.7 percent after the airline forecast a bigger loss this year.

The unemployment rate in New Zealand came in at a seasonally adjusted 4.0 percent in the second quarter of 2021, Statistics New Zealand said today, beating expectations for a rate of 4.5 percent.

U.S. stocks rose overnight as upbeat earnings and continued optimism about the economic outlook outweighed concerns over deepening regulatory scrutiny in China.

The S&P 500 climbed 0.8 percent to reach a new record closing high and the Dow also gained 0.8 percent, while the tech-heavy Nasdaq Composite rose 0.6 percent.

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