Asian stocks mixed after Wall St rally on economic optimism

TOKYO (AP) — Asian shares were mixed yesterday after a Wall Street rally that reflected some optimism about the economy recovering from the pandemic.

Japan’s benchmark Nikkei 225 lost early gains and fell nearly 0.2 per cent to 30,038.44 in morning trading. South Korea’s Kospi edged up 0.1 per cent to 3,125.19. The Shanghai Composite slipped 0.1 per cent to 3,479.84. Hong Kong trading was closed for Easter.

Chief Market Economist at SMBC Nikko Yoshimasa Maruyama noted a gradual recovery in the Japanese economy had been reflected in the recent tankan Bank of Japan survey, which was released last week. He said a rebound was marked in electronics because of households consuming electronics goods, as the pandemic had squelched people’s spending
on services.

However, household spending data released yesterday showed a 6.6 per cent decline in February, with dining, clothing, transport and entertainment falling sharply.

Deep worries remain over the pandemic, with medical experts warning Japan to brace for a “fourth wave” of surging infections and deaths related to COVID-19, as the nation has fallen behind the rest of the world in testing and vaccinations.

Similar outbreaks have flared in other countries, including India and Thailand.

Currency traders wearing face masks watch monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea. PHOTO: AP

On Wall Street, the S&P 500 rose 1.4 per cent to 4,077.91, another record high. The Dow Jones Industrial Average rose 379 points, or 1.2 per cent, to 33,527.19 and the Nasdaq was 1.6 per cent higher, at 13,705.59.

The gains came after the United States (US) government reported that employers went on a hiring spree in March, adding 916,000 jobs, the most since August.

Traders had a delayed reaction to the encouraging jobs report, which was released on Friday when stock trading was closed. Investors were further encouraged by a report on Monday showing that the services sector recorded record growth in March as orders, hiring and prices surged.

Both employment and the services industry have been lagging other areas of the economy throughout the recovery. Analysts have said that both need to show signs of growth in for the recovery to remain on track. In the US, the strong rollout of vaccinations is making an eventual return to normal for many people seem clearer and closer.

“The jobs report underscored the rebound in the labour market,” said Chief Market Strategist at Prudential Financial Quincy Krosby. “The only thing that can stymie this rebound, this recovery, will be that COVID-19 launches another wave.”

The gains were broad on Monday, with nearly every sector rising. Companies that stand to benefit from a broader re-opening of the economy and economic growth also did well. Norwegian Cruise Line jumped 7.2 per cent for the biggest gain in the S&P 500 as it seeks permission to restart cruises out of US ports in July with a vaccination requirement for passengers and crew members. Rival Carnival rose 4.8 per cent and Royal Caribbean gained 3.5 per cent.

Technology stocks also powered the gains. Apple rose 2.1 per cent and Microsoft gained 2.5 per cent. Tesla surprised investors with a report that vehicle deliveries doubled during the first quarter. Its shares surged 5.1 per cent.

In energy trading, benchmark US crude added 69 cents to USD59.34 a barrel in electronic trading on the New York Mercantile Exchange. It gave up USD2.80 to USD58.65 per barrel on Monday. Brent crude, the international standard, rose 56 cents to USD62.71 a barrel.

In currency trading, the US dollar rose to JPY110.24 from JPY110.19. The euro cost USD1.1811, down from USD1.1813.