Asian Markets Mostly Higher

Asian Markets Mostly Higher

November 5, 2021

Asian stock markets are trading mostly higher on Monday, following the positive cues from Wall Street on Friday, on higher crude oil prices and as traders reacted to the results of Japan’s lower house election. Traders are also reluctant to make significant bets ahead of the Federal Reserve’s monetary policy meeting this week. Asian markets closed mixed on Friday.

Global supply chain disruptions and concerns over a lack of electricity supplies in China kept underlying sentiment cautious.

The Australian stock market is modestly higher on Monday, recouping the losses in the previous two sessions, with the benchmark S&P/ASX 200 just below the 7,400 level, following the positive cues from Wall Street on Friday, with energy and technology stocks providing support, partially offset by weakness in mining and financial stocks.

Meanwhile, the upside is limited with the domestic coronavirus situation still grim, particularly in Victoria, even though the lockdowns have been lifted and borders are open.

Victoria recorded 1,471 new locally acquired cases and four deaths on Sunday, with the total active cases of COVID-19 across Victoria standing at 21,959. NSW reported only 135 new locally acquired cases and four deaths.

The benchmark S&P/ASX 200 Index is gaining 46.70 points or 0.64 percent to 7,370.40, after touching a high of 7,388.30 earlier. The broader All Ordinaries Index is up 53.50 points or 0.70 percent to 7,692.60. Australian stocks closed sharply lower on Friday.

Among the major miners, Rio Tinto is edging down 0.2 percent, BHP Group is down almost 1 percent and OZ Minerals is losing almost 2 percent, while Fortescue Metals, Mineral Resources and Fortescue Metals are gaining more than 1 percent each.

Oil stocks are higher, with Oil Search, Beach energy, Origin Energy, Woodside Petroleum and Santos all gaining more than 1 percent each.

Among tech stocks, Afterpay is losing more than 1 percent, while Appen is gaining more than 2 percent, WiseTech Global is adding almost 6 percent and Xero is up more than 4 percent.

Gold miners are mostly lower. Northern Star Resources is losing almost 1 percent, Resolute Mining is down more than 1 percent, Newcrest Mining is declining almost 2 percent and Evolution Mining is edging down 0.3 percent, while Gold Road Resources is edging up 0.4 percent.

Among the big four banks, Commonwealth Bank is up almost 1 percent, while National Australia Bank is edging down 0.5 percent and ANZ Banking is losing more than 1 percent. Westpac is declining more than 6 percent despite more than double profit and returning cash to shareholders.

Shares in AusNet are rising almost 5 percent after the energy infrastructure firm agreed to a $10.2 billion cash takeover deal by Canada’s Brookfield Asset Management.

Shares of Prime Media Group are skyrocketing 70 percent after Kerry Stokes-owned television and publishing firm Seven West Media struck a deal to acquire Prime, its regional affiliate, for $131.9 million.

In economic news, the manufacturing sector in Australia continued to expand in October, and at a faster pace, the latest survey from Markit Economics revealed on Monday with a manufacturing PMI score of 58.2. That’s up from 56.8 in September, and it moved further above the boom-or-bust line of 50 that separates expansion from contraction. This marks the seventeenth straight month in which the sector grew and at the fastest rate seen since June. Demand and production both expanded at faster rates compared to September.

Further, the total value of owner-occupied home loans in Australia was down a seasonally adjusted 2.7 percent on month in September, the Australian Bureau of Statistics said on Monday – coming in at A$20.69 billion. That missed expectations for a decline of 2.0 percent following the 6.6 percent plunge in August. Investment lending was up 1.4 percent on month at A$9.62 billion and overall home loans fell 1.4 percent on month to A$30.31 billion. On a yearly basis, owner-occupied home loans gained 20.8 percent, while investment lending skyrocketed 83.2 percent and overall home loans jumped 35.5 percent.

In the currency market, the Aussie dollar is trading at $0.751 on Monday.

The Japanese stock market is sharply higher on Monday, extending the modest gains in the previous session, with the Nikkei 225 adding more than 600 points to storm above the 29,500 level, following the positive cues from Wall Street on Friday and with traders upbeat on results of Japan’s lower house election. The re-election of the ruling coalition will eliminate political and policy uncertainties and pave the way for fiscal stimulus.

The benchmark Nikkei 225 Index closed the morning session at 29,538.15, up 645.46 points or 2.23 percent, after touching a high of 29,633.33 earlier. Japanese shares ended modestly higher on Friday.

Market heavyweight SoftBank Group is gaining 3 percent and Uniqlo operator Fast Retailing is adding almost 5 percent. Among automakers, Honda is gaining more than 2 percent and Toyota is adding more than 1 percent.

In the tech space, Advantest is surging more than 6 percent, Screen Holdings is gaining more than 4 percent and Tokyo Electron is up more than 3 percent. In the banking sector, Sumitomo Mitsui Financial, Mizuho Financial and Mitsubishi UFJ Financial are all gaining more than 1 percent each.

The major exporters are mostly higher, with Panasonic losing 1.5 percent, while Sony is gaining more than 5 percent and Canon is edging up 0.3 percent. Mitsubishi Electric is flat.

Among the other major gainers, Toyota Tsusho is gaining more than 6 percent, Japan Tobacco is adding almost 6 percent and Pacific Metals is up more than 4 percent, while Kikkoman, Shimizu and Hino Motors are higher by almost 4 percent each. Yaskawa Electric, Omron, Bandai Namco and Daikin Industries are up more than 3 percent each.

Conversely, Nomura Holdings is losing more than 7 percent.

In economic news, the manufacturing sector in Japan continued to expand in October, and at a faster pace, the latest survey from Jibun Bank showed on Monday with a Manufacturing PMI score of 53.2. That’s up from 51.5 in September and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.

In the currency market, the U.S. dollar is trading in the lower 114 yen-range on Monday.

Elsewhere in Asia, China, Singapore, South Korea, Taiwan and Indonesia are higher by between 0.1 and 0.8 percent each. New Zealand, Hong Kong and Malaysia are lower by between 0.5 and 1.6 percent each.

On Wall Street, stocks showed a significant turnaround over the course of the trading session on Friday, recovering from an early move to the downside to end the day mostly higher. The rebound on the day lifted the major averages to new record closing highs.

The major averages ended the day just off their highs of the session. The Dow rose 89.08 points or 0.3 percent to 35,819.56, the Nasdaq climbed 50.27 points or 0.3 percent to 15,498.39 and the S&P 500 edged up 8.96 points or 0.2 percent to 4,605.38.

Meanwhile, the major European markets turned mixed over the course of the session. While the French CAC 40 Index climbed 0.4 percent, the German DAX Index edged down by 0.1 percent and the U.K.’s FTSE 100 Index dipped by 0.2 percent.

Crude oil futures settled higher on Friday on hopes that OPEC and allies will decide to keep supply levels tight. West Texas International Crude oil futures for December rose $0.76 or 0.9 percent at $83.57 a barrel; WTI Crude futures gained more than 11 percent in October.

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