Asian shares rally boosted by US earnings, rally


Asian shares rallied on Friday as investors welcomed a string of strong earnings from retailers that sent US shares higher.

Benchmarks rose in initial trading across the region, including Japan, China, Australia and South Korea.

Yeap Jun Rong, market strategist at IG in Singapore, said: “The improved risk sentiment on Wall Street, coupled with earnings outperformance from Alibaba and Baidu, could help spur some gains. growth for Asia in today’s trading session.

Shares of Alibaba and Baidu surged after they reported better-than-expected results, easing some concerns about the negative impact of restrictions aimed at curbing COVID-19 infections. Both stocks continued to rise in early trading.

A review of Japan’s economic path will be of interest to investors when manufacturing, housing and employment data for April is released next week. Some analysts say the numbers won’t be as clear as exports to China have slowed during that time.

But some optimism has also come with Tokyo easing restrictions on tourists and the daily limit increasing from 10,000 people to 20,000 starting June 1. Japanese government, led by Prime Minister Fumio Kishida, will also promote discussions in parliament. with an additional budget, a possible plus for investors.

Japan’s benchmark Nikkei 225 index rose 0.8 percent in early trading to 26,811.06. Australia’s S&P/ASX 200 rose 0.9% to 7,167.70. South Korea’s Kospi rose 1.0% to 2,638.92. Hong Kong’s Hang Seng rose 2.8% to 20,687.39, while the Shanghai Composite added 0.6% to 3,141.15.

Wall Street ended higher after seven consecutive weeks of declines, the longest stretch since 2001.

Bond yields increased. Yields on 10-year Treasuries, which help set interest rates on mortgages, rose to 2.75% from 2.74% late Wednesday.

About 90% of stocks in the S&P 500 rose, with technology companies, banks and retailers driving much of the rally. While trading has remained volatile this week, the market has mostly edged higher, unlike five weeks ago, when the S&P 500 was down 2% or more at least one day per week.

“It’s great to see a few clear days and this could really end up being the first week we haven’t had a bad day,” said Liz Young, head of investment strategy at SoFi. . “But I’m not going to declare victory too soon and assume we’re in the clear.”

The S&P 500 rose 79.11 points, or 2%, to 4,057.84. The Dow added 516.91 points, or 1.6%, to 32,637.19 and the Nasdaq added 305.91 points, or 2.7%, to 11,740.65. The Russell 2000 index of smaller companies rose 39.07 points, or 2.2%, to 1,838.24.

Retailers led the broader market on Thursday. Macy’s rose 19.3% after raising its profit forecast for the year following a strong first-quarter financial report. Dollar General up 13.7% and Dollar Tree up 21.9% were the biggest gains in the S&P 500 after discount retailers reported steady earnings and provided encouraging forecasts for investors. private.

The retail sector is being closely watched by investors seeking more details on how inflation will affect companies and consumers. Weak reports from several major companies last week, including Target and Walmart, have taken a toll on an already volatile market.

“We don’t believe we’ve completely escaped the jungle here,” said Philip Orlando, director of equity market strategy at Federated Hermes. “There were a lot of negative reports last week and what those companies were talking about was what was going on in the economy.”

Inflation is at a four-decade high and businesses have raised prices of everything from food to clothing to offset higher costs. The impact of Russia’s invasion of Ukraine has increased inflationary pressures by driving vital food and energy costs higher. Supply chain problems worsened after China locked down several major cities as it tried to contain COVID-19 cases.

Consumers have been resilient in their spending, but inflationary pressures persist and could lead to a reduction or shift in spending from more expensive things to necessities.

Thursday’s broad gains followed a late boost to markets on Wednesday boosted by details from the Federal Reserve’s latest meeting, confirming expectations of more rate hikes. than.

Technology stocks also rose. TurboTax maker Intuit rose 4.6%. Industry companies, with high stock values, tend to push the market up or down harder.

Airline shares rose on encouraging summer travel forecasts. Southwest Airlines is up 6% and JetBlue is up 3.4%.

In energy trading, the price of benchmark US crude rose 36 cents to $114.45 a barrel. U.S. crude oil prices rose 3.4% on Thursday, and are up more than 55% on the year. Brent crude, the international standard, rose 45 cents to $117.85 a barrel.

In currency trading, the US dollar inched down to 126.79 Japanese yen from 127.10 yen. The euro is priced at $1.0763, up from $1.0733.


AP business writers Damian J. Troise and Alex Veiga contributed.

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