ASIA MARKETS: Asian Markets Tick Up Ahead Of Trump's Address To Congress
February 27 2017 - 11:11PM
Dow Jones News
By Ese Erheriene
Nikkei rises despite poor economic data; oil firms gain on
higher crude prices
Investors regained their appetite for Asian equities on Tuesday,
boosted by fresh highs in U.S. markets ahead of Donald Trump's
speech to Congress.
The Nikkei Stock Average was up 0.6% in early trading, shrugging
off poor economic data. Japan posted its first drop in industrial
output in six months in January, as production of cars fell and the
Lunar New Year holiday lowered demand from China, an important
export market.
Elsewhere, Australia's S&P/ASX 200 was 0.4% higher, Korea's
Kospi added 0.3%, and Hong Kong's Hang Seng Index was last up
0.1%.
Overnight in the U.S., a rally in energy, financial and
biotechnology shares lifted the major indexes. The Dow Jones
Industrial Average rose 16 points to close at its 12th consecutive
record high, the S&P 500 rose 0.1%, and the Nasdaq Composite
added 0.3%.
Rebounding from sharp losses in the previous session, Asian
stock markets were back in the black in anticipation of Trump's
speech to Congress on Tuesday, following a budget proposal from the
White House on Monday that would boost military spending by around
$20 billion.
"The market is currently holding this wait-and-see attitude,"
said Jingyi Pan, a market strategist at IG Group. "There will be a
few things that the market will hunt for in his address today.
These include tax, infrastructure and trade policies."
Meanwhile, hawkish comments from Federal Reserve Bank of Dallas
President Robert Kaplan overnight renewed market expectations for
more U.S. rate increases in the coming months. According to CME
data, the likelihood of a rate rise in March is 33.2%, up from
26.6% the previous day.
Kaplan's comments proved bullish for Treasury yields and dollar
strength against the yen overnight, which gave an updraft to local
financial companies and exporters. Among individual shares,
Australia's Big Four banks -- which account for roughly a third of
the benchmark index's weighting -- were up between 0.7% and 1.4%.
In Japan, Nomura (8604.TO) was up 1.9% and Dai-ichi Life (8750.TO)
gained 1.1%, while auto makers Honda Motor (HMC) and Mazda Motor
(7261.TO) added 1.0% and 1.9%, respectively.
In the commodities market, oil prices rose 0.2%, building on
gains in the U.S. session. This supported the bottom lines of oil
and gas firms across the region. Japan Petroleum Exploration
(1662.TO) was 2.6% higher, Australia's Santos (SSLTY) was up 2.5%
and Hong Kong-listed oil major China Petroleum & Chemical
(600028.SH) rose 0.2%.
In currencies, the dollar-yen pair saw some profit-taking, with
the dollar recently down 0.1% at Yen112.59 from a high of Yen112.82
yen in early Tokyo trade. Along with some profit-taking, there may
have been trades to position ahead of Trump's speech, said Masahi
Murata, a senior currency strategist at Brown Brothers
Harriman.
Looking ahead, market participants will be watching out for the
second estimate of French fourth-quarter gross domestic product
later in the global trading day, and positioning for Chinese
manufacturing data on Wednesday.
(END) Dow Jones Newswires
February 27, 2017 22:56 ET (03:56 GMT)
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