Asian Markets In Positive Territory After Wall Street Rally

Asian stock markets are in positive territory on Wednesday following the overnight rally on Wall Street amid optimism about a new U.S. fiscal stimulus bill and progress in the rollout of COVID-19 vaccines. U.S. House Speaker Nancy Pelosi has scheduled a meeting with other congressional leaders to discuss a relief package.

In addition, shares of Apple’s suppliers in Asia advanced after the Nikkei reported that the tech giant plans to increase iPhone production by about 30 percent in the first half of 2021.

The Australian market is rising following the positive cues from Wall Street and as higher commodity prices lifted resources stocks. In addition, upbeat Australian manufacturing sector data boosted sentiment.

The benchmark S&P/ASX 200 Index is advancing 76.60 points or 1.16 percent to 6,707.90, after touching a high of 6,713.40 earlier. The broader All Ordinaries Index is adding 77.90 points or 1.13 percent to 6,944.60. Australian stocks closed lower on Tuesday.

Among the major miners, Fortescue Metals is rising more than 3 percent, while BHP Group and Rio Tinto are advancing more than 2 percent each.

The big four banks – ANZ Banking, National Australia Bank, Westpac and Commonwealth Bank – are advancing in a range of 1.5 percent to 1.9 percent.

Gold miners are also rising after gold prices rebounded to a two-week high overnight. Evolution Mining is higher by more than 2 percent and Newcrest Mining is adding almost 1 percent.

Oil stocks are higher even after crude oil prices rose notably overnight. Woodside Petroleum is advancing more than 1 percent, Santos is adding 0.6 percent and Oil Search is up 0.3 percent.

In economic news, the latest survey from Markit Economics showed that the manufacturing sector in Australia continued to expand in December, and at a faster pace, with a five-month high manufacturing PMI score of 56.0. That’s up from 55.8 and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.

The report also showed that the services PMI rose from 55.1 to 57.4 and the composite climbed from 54.9 to 57.0 – both also five-month highs.

Australia will also see November numbers for the Westpac leading index and for home sales.

The Japanese market is advancing after U.S. stocks rallied overnight. Apple’s suppliers in Japan advanced after the Nikkei reported that the company plans to increase iPhone production in the first half of 2021.

The benchmark Nikkei 225 Index is adding 82.95 points or 0.31 percent to 26,770.79, after touching a high of 26,874.98 earlier. The Japanese market closed lower on Tuesday.

Market heavyweight SoftBank Group and Fast Retailing are adding 0.6 percent each. In the tech space, Advantest is declining more than 1 percent and Tokyo Electron is down 0.2 percent.

The Nikkei reported that Apple plans to increase iPhone production by about 30 percent in the first half of 2021 to 96 million following a surge in demand for the company’s first-ever 5G handsets amid the pandemic.

Among Apple’s Japan-based suppliers, Alps Alpine is rising more than 5 percent, Taiyo Yuden is advancing more than 1 percent, Kyocera is higher by almost 1 percent and Hitachi is adding 0.6 percent.

The major exporters are all higher despite a stronger yen. Panasonic is rising more than 3 percent, Canon is advancing more than 2 percent, Mitsubishi Electric is adding 0.6 percent and Sony is up 0.3 percent.

Among automakers, Toyota is advancing more than 1 percent and Honda is adding 0.3 percent. Honda is recalling 1.79 million vehicles worldwide, including 1.4 million vehicles in the U.S., over multiple issues.

In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are higher by almost 1 percent each.

Pasona Group is adding 0.7 percent after the Nikkei reported that the staffing agency plans to hire and groom 1,000 jobless college and high school graduates.

Among the other major gainers, Nippon Sheet Glass is gaining more than 7 percent, NTN Corp. is rising almost 6 percent and Mitsui E&S is higher by more than 5 percent each.

Conversely, Sumco Corp. and Yamaha Corp. are losing almost 3 percent each, while Yokogawa Electric is lower by 2 percent.

On the economic front, the latest survey from Jibun Bank revealed that the manufacturing sector in Japan continued to contract in November, albeit at a slower pace, with a manufacturing PMI score of 49.7. That’s up from 49.0, although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.

Japan posted a merchandise trade surplus of 366.8 billion yen in November. That was well shy of expectations for a surplus of 529.8 billion yen and down sharply from 872.9 billion yen in October.

Exports were down 4.2 percent on year, missing forecasts for an increase of 0.5 percent following the 0.2 percent decline in the previous month. Imports tumbled an annual 11.1 percent versus expectations for a fall of 10.5 percent after sinking 13.3 percent a month earlier.

In the currency market, the U.S. dollar is trading in the upper 103 yen-range on Wednesday.

Elsewhere in Asia, Taiwan, Indonesia and Malaysia are all advancing more than 1 percent each, while New Zealand and Hong Kong are adding almost 1 percent each. Shanghai, South Korea and Singapore are also higher.

On Wall Street, stocks rallied on Tuesday mid unrelenting optimism lawmakers will eventually agree on a new fiscal stimulus bill. Stocks accelerated to the upside following news that House Speaker Nancy Pelosi has scheduled a meeting with other congressional leaders to discuss a relief package. Adding to the positive sentiment, the Federal Reserve released a report showing U.S. industrial production rose by slightly more than expected in the month of November.

The Dow jumped 337.76 points or 1.1 percent to 30,199.31, the Nasdaq surged up 155.02 points or 1.3 percent to 12,595.06 and the S&P 500 shot up 47.13 points or 1.3 percent to 3,694.62.

Meanwhile, the major European markets turned in another mixed performance on Tuesday. While the U.K.’s FTSE 100 Index fell by 0.3 percent, the French CAC 40 Index inched up by 0.1 percent and the German DAX Index surged up by 1.1 percent.

Crude oil prices moved higher on Tuesday amid easing concerns about the outlook for energy demand following the rollout of a coronavirus vaccine. WTI crude oil for January delivery climbed $0.63 or about 1.3 percent to $47.62 a barrel.

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