Asian markets advance after S&P 500 snaps losing streak

Elaine Kurtenbach

AP – Asian shares were mostly higher yesterday after stocks eked out small gains on Wall Street following a mixed set of reports on the economy.

Benchmarks rose in Tokyo, Hong Kong and Sydney.

Stocks fell in Shanghai after China’s market regulator said it has launched an anti-monopoly investigation of e-commerce giant Alibaba Group, stepping up official efforts to tighten control over the country’s fast-growing tech industries.

China also is ramping up its scrutiny of the practice of community group buying, summoning some of the nation’s largest tech companies for discussions as part of the anti-monopoly push.

China’s State Administration for Market Regulation also recently summoned six companies, including Alibaba and other e-commerce platforms such as JD.com and Pinduoduo, gaming company Tencent, food delivery firm Meituan and ridesharing firm Didi Chuxing to talk about the potential ramifications of community group buying.

A currency trader walks by screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea. PHOTO: AP

The Shanghai Composite index lost 0.3 per cent to 3,373.66. Shares also fell on the smaller market in southern China’s Shenzhen.

But elsewhere, yesterday trading was upbeat. Tokyo’s Nikkei 225 index gained 0.5 per cent yesterday to 26,665.72 and the Hang Seng in Hong Kong edged 0.1 per cent higher, to 26,383.13. In South Korea, the Kospi jumped one per cent to 2,785.26. Australia’s S&P/ASX 200 rose 0.5 per cent to 6,674.40.

“Although some reshuffling of portfolios in emerging Asia was to be expected ahead of the holiday break, the underlying theme is a positive one,” Jeffrey Halley of Oanda said in a commentary.

On Wednesday, the S&P 500 inched up 0.1 per cent to 3,690.01. The benchmark index set a record high yesterday and is up 14.2 per cent so far this year.

Gains by financial, communication services, energy and other sectors were kept in check by declines elsewhere, including technology companies, which helped pulled the Nasdaq slightly lower.

An hour before trading began on Wall Street, the government released an avalanche of data on the economy that showed some optimistic signs and several disappointing ones.

The Labour Department said fewer United States (US) workers filed for unemployment benefits last week. The number is still incredibly high compared with before the pandemic, but it was better than economists were expecting.

Another report said that orders for long-lasting goods strengthened by more than expected last month, a good sign for the nation’s manufacturers.

But other reports were grimmer. Consumers pulled back on their spending by more last month than economists expected. It was the first drop since April and was mainly because incomes dropped sharply in November, by more than economists had forecast.

The Dow Jones Industrial Average added 0.4 per cent to 30,129.83. The Nasdaq composite fell 0.3 per cent, to 12,771.11, while the Russell 2000 index climbed above the 2,000-point mark for the first time. It gained 0.9 per cent to 2,007.10.

Stock futures initially dropped after US President Donald Trump said that he may not sign the USD900 billion rescue for the economy that Congress approved on Monday night.

The hope in markets had been that the package might tide the economy over until widespread vaccinations can help the world begin to return to normal. The legislation includes one-time cash payments of USD600 to most Americans, extra benefits for laid-off workers and other financial support.

Trump said late Tuesday that he wants to see bigger cash payments going to most Americans, up to USD2,000 for individuals. He also criticised other parts of the bill.

But shares eventually drifted upward as investors looked past the unexpected pushback.

“Despite the churning of the Washington DC pond by vetos, new votes, and overrides, Wall Street clearly believes something positive will float to the top of the barrel when the churning stops,” Halley said.

The yield on the 10-year Treasury rose to 0.95 per cent from 0.90 per cent late Tuesday.

In other trading, US benchmark crude gained 12 cents to USD48.24 per barrel in electronic trading on the New York Mercantile Exchange. It gained USD1.10 to USD48.12 on Wednesday. Brent crude, the international standard, added 14 cents to USD51.38 per barrel. The dollar slipped to JPY103.52 from JPY103.54 late Wednesday. The euro rose to USD1.2213 from USD1.2192.