Asian markets higher despite lacklustre cues from Wall St

by Jonathan Adams
Wall Street rises

Markets continue to be optimistic about higher stimulus package and the global economic recovery as U.S. bond yields moved lower for the third session in a row

Stock markets in Asia are mostly higher on Wednesday despite the lacklustre cues overnight from Wall Street. The markets continue to be optimistic about higher stimulus package and the global economic recovery as U.S. bond yields moved lower for the third session in a row and lower crude oil prices. Asian stocks broadly ended lower on Tuesday.

The Australian stock market is advancing on Wednesday, recouping some of its recent losses, with the benchmark S&P/ASX 200 rising again above the 6,800 level on a huge rally in the materials stocks. According to the latest GDP figures, Australia’s economy is recovering as it expanded for the second consecutive quarter.

The S&P/ASX 200 Index is advancing 54.00 points or 0.80 percent to 6,816.30, after reaching a high of 6,817.80 earlier. The broader All Ordinaries Index is up 55.70 points or 0.79 percent to 7,065.30. Australian markets erased early gains to finish lower on Tuesday. In the tech space, Appen and Afterpay are dropping more than 2 percent, while WiseTech Global is advancing 0.6 percent.

Gold miners are higher as gold prices snapped a five-day losing streak. Evolution Mining and Newcrest Mining are advancing more than 2 percent, while Northern Star Resources is gaining nearly 4 percent.

Among the major miners, BHP Group is gaining about 3 percent, Fortescue Metals is up more than 3 percent and Rio Tinto is gaining over 1 percent.

Rio Tinto Chairman Simon Thompson is stepping down and will not seek re-election after investor pressure on mishandling of investigations after destruction of two ancient Aboriginal rock shelters.

Oil stocks are higher, with Oil Search gaining about 1 percent, Santos advancing nearly 2 percent, while Woodside Petroleum is rising 0.2 percent.

Among the big four banks, ANZ Banking, Westpac and National Australia Bank are adding over 1 percent, while Commonwealth Bank is rising 0.5 percent. In economic news, the Australian Bureau of Statistics said on Wednesday that Australia’s gross domestic product (GDP) expanded a seasonally adjusted 3.1 percent on quarter in Q4 2020. That beat expectations for a gain of 2.5 percent the upwardly revised 3.4 percent gain in the previous three months. On a yearly basis, GDP fell 1.1 percent – again exceeding expectations for a decline of 1.8 percent after dipping 3.8 percent in the three months prior.

According to the latest survey from the Australian Industry Group, the construction sector in Australia continued to expand in February, though at a slightly slower pace, with a Performance of Construction Index score of 57.4. That’s down from 57.6 in January, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction. All four sectors in the index recovered strongly in February.

The services sector in Australia continued to expand in February, albeit at a slightly slower pace, the latest survey from Markit Economics showed, with a services PMI score of 53.4. That’s lower than 55.6 in January and preliminary estimate of 54.1, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that its composite index dropped to 53.7 in February from 55.9 in January and compared to a preliminary estimate of 54.4.

The Japanese stock market is advancing on Wednesday, with the benchmark Nikkei 225 reaching above the 29,400 level. The Nikkei 225 Index finished the morning session at 29,459.71, up 51.54 points or 0.18 percent, after hitting a high of 29,538.76 in early trades. Japanese shares closed lower on Tuesday.

Elsewhere in Asia, Hong Kong, South Korea, China, Singapore, Indonesia, Taiwan and Malaysia are all higher, while New Zealand is dropping.



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