Asian Markets Extend Gains

Asian stock markets are mostly higher on Friday, extending gains from the previous session, following the overnight rebound on Wall Street as investors shifted focus to the upcoming corporate earnings season amid a lack of escalation in U.S.-China trade tensions.

Markets are responding positively to the lack of an announcement of specific retaliation by China in response to new U.S. tariffs on $200 billion worth of Chinese imports.

The Australian market pared early gains and is modestly lower, as weakness in banking stocks offset gains by the major miners.

In late-morning trades, the benchmark S&P/ASX 200 Index is declining 4.90 points or 0.08 percent to 6,263.40, after touching a high of 6,287.10 earlier. The broader All Ordinaries Index is down 3.60 points or 0.06 percent to 6,346.20. Australian shares closed higher on Thursday.

In the banking space, ANZ Banking, Westpac, National Australia Bank and Commonwealth Bank are lower in a range of 0.3 percent to 0.6 percent.

The major miners are advancing after iron ore prices edged up overnight. BHP Billiton is adding 0.4 percent and Fortescue Metals is up 0.2 percent.

Rio Tinto is rising 0.6 percent after the company said it has signed a heads of agreement to sell its interest in Indonesia’s Grasberg mine – the world’s second biggest copper mine, for $3.5 billion.

Gold miners are mixed even as gold prices rose overnight. Evolution Mining is higher by 0.3 percent, while Newcrest Mining is edging down by less than 0.1 percent.

Oil stocks are mostly lower as crude oil prices edged lower overnight. Oil Search is adding 0.1 percent, while Woodside Petroleum is losing 0.6 percent and Santos is lower by 0.3 percent.

In the currency market, the Australian dollar is higher against the U.S. dollar on Friday. The local currency was quoted at US$0.7405, down from US$0.7387 on Thursday.

The Japanese market is rising, tracking the overnight rebound on Wall Street and a weaker safe-haven yen amid a lack of escalation in U.S.-China trade tensions.

The benchmark Nikkei 225 Index is advancing 299.19 points or 1.35 percent to 22,487.15, off a high of 22,530.19 in early trades. Japanese shares recovered from sharp losses in the previous session to close higher on Thursday.

The major exporters are higher on a weaker yen. Sony is advancing almost 2 percent, Panasonic is rising more than 1 percent, Canon is higher by almost 1 percent and Mitsubishi Electric is adding 0.2 percent.

In the auto sector, Honda is edging down less than 0.1 percent, while Toyota is rising 0.2 percent. In the banking space, Mitsubishi UFJ Financial is gaining 0.4 percent and Sumitomo Mitsui Financial is edging higher by 0.1 percent.

Among oil stocks, Inpex is rising 0.6 percent, while Japan Petroleum Exploration is losing more than 2 percent each after crude oil prices edged higher overnight.

Among the market’s best performers, Fast Retailing is gaining almost 6 percent after reporting a more than 23 percent increase in net profit for the nine-month period. Tokai Carbon is higher by almost 5 percent and Recruit Holdings is up more than 3 percent.

On the flip side, Concordia Financial is losing more than 8 percent, Yaskawa Electric is lower by more than 3 percent and Showa Shell Sekiyu is down more than 2 percent.

In economic news, Japan will see final May numbers for industrial production and capacity utilization today.

In the currency market, the U.S. dollar is trading in the upper 112 yen-range on Friday.

Elsewhere in Asia, South Korea, Singapore, New Zealand, Indonesia, Malaysia, Hong Kong and Taiwan are also higher, while Shanghai is modestly lower.

On Wall Street, stocks rebounded to close higher on Thursday, partly due to optimism about the upcoming earnings season as several leading financial companies are due to report their quarterly results on Friday. Easing trade concerns also contributed to the rally.

The tech-heavy Nasdaq soared 107.30 points or 1.4 percent to a new record closing high of 7,823.92, the Dow jumped 224.74 points or 0.9 percent to 24,924.89, and the S&P 500 surged up 24.27 points or 0.9 percent to 2,798.29.

The major European markets also moved back to the upside on Thursday. While the French CAC 40 Index jumped by 1 percent, the U.K.’s FTSE 100 Index advanced by 0.8 percent and the German DAX Index climbed by 0.6 percent.

Crude oil futures failed to rally Thursday after the International Energy Agency or IEA warned that the world’s oil supply cushion “might be stretched to the limit” due to production losses. WTI crude dipped $0.05 to $70.33 a barrel on the New York Mercantile Exchange.

by RTTNews Staff Writer

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