Most Asia stocks start week on a high, HK up for 10th day

HONG KONG (AFP) – Most Asian markets rose yesterday following yet more records on Wall Street, with Hong Kong chalking up its 10th day of gains.

Traders in New York pushed all three main indexes ever higher on Friday, unperturbed by a well-below-forecast jobs reading. Analysts said the figures indicated the employment market was tightening.

With the corporate earnings season about to begin, global equities continue to see in the new year on a positive note, with optimism boosted by a strong US economy.

Greg McKenna, chief market strategist at AxiTrader, said, “There is a growing feeling that US stocks have entered the final stage of this great bull market. That’s certainly a view that seems to be starting to gain traction.

“But even as traders and investors worry we are in the ‘frothy’ stage of the rally, there is still some reluctance to call a top. That makes sense given the strength of the US and global economy and the impetus from the tax cuts.”

However, he warned, “But sometime in the next few months, all the good news will be priced in.”

Hong Kong rose 0.3 per cent, continuing an impressive run of gains that have seen the Hang Seng Index rise more than five per cent to its highest level since late 2007.

Shanghai rose 0.5 per cent, Sydney added 0.1 per cent and Singapore was 0.2 per cent higher, while Seoul put on 0.6 per cent as officials from North and South Korea prepare to hold talks for the first time since 2015.

Jakarta and Bangkok were also higher but Wellington and Manila dipped. Tokyo was closed for a public holiday.

Investors were given a strong lead from their US counterparts, who looked past news that 148,000 new jobs were created in December, well off the 190,000 expected.

Chris Conway, chief market and trading specialist at Australian Stock Report, said it was “still a fairly solid number that fits with the tight labour market theme”.

Commentators pointed out that while the reading was below par, wages rose and a tighter jobs market could in turn lead to further increases in pay and higher inflation, which would then push the Federal Reserve to raise interest rates.

The dollar rose against its peers after recent losses, with Stephen Innes, head of Asia-Pacific trading at OANDA, saying the greenback could be in line for a rebound.

He also highlighted the release by the Fed of minutes from policy meetings it held in 2012 that were attended by its next boss Jerome Powell. These showed his hawkish credentials, providing support to the dollar.

In early European trade London was flat, Paris gained 0.2 per cent and Frankfurt added 0.6 per cent.