Asian stocks follow Wall Street higher after strong results
Updated 9:13 pm, Thursday, April 26, 2018
BEIJING (AP) — Asian stock markets followed Wall Street higher on Friday after reports of strong U.S. earnings, as investors watched the inter-Korean summit.
KEEPING SCORE: The Shanghai Composite Index sank 0.7 percent to 3,052.32, but Tokyo's Nikkei 225 rose 0.5 percent to 22,441.28. Hong Kong's Hang Seng advanced 0.1 percent to 30,042.83 and Seoul's Kospi added 0.5 percent to 2,486.82. Sydney's S&P-ASX 200 climbed 0.3 percent to 5,930.50. Benchmarks in New Zealand, Taiwan and Southeast Asia also rose.
WALL STREET: Stocks climbed as Facebook led a rally by technology companies. Amazon, Microsoft, Starbucks and United Parcel Service reported higher first-quarter profits. Strong results from companies including Chipotle Mexican Grill and O'Reilly Automotive helped retailers and other consumer-focused companies. Energy companies also climbed. The Standard & Poor's 500 index rose 1 percent to 2,666.94. The Dow Jones industrial average added 1 percent to 24,322.34. The technology-heavy Nasdaq composite advanced 1.6 percent to 7,118.68.
KOREA SUMMIT: Kim Jong Un became the first North Korean leader to visit South Korea since the end of the Korean War in 1953 when he stepped across their heavily armed border for talks Friday with the South's president, Moon Jae-in, about the North's nuclear program. The meeting comes amid mounting pressure on Kim's government to give up nuclear and missile development. Kim and Moon greeted other warmly and went into a private meeting, details of which were not released. The North's new agency said Kim would "open-heartedly" discuss with Moon "all the issues arising in improving inter-Korean relations and achieving peace, prosperity and reunification of the Korean peninsula."
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Speculation was mounting Tuesday that a high-level North Korean official who arrived unexpectedly in Beijing amidst high security was Supreme Leader Kim Jong-un. Japanese media first claimed that Kim had arrived in China by train via the northeastern border city of Dandong. Nippon TV, a Japanese television network, aired images of a train arriving Monday which looked like one used by the leader's predecessor Kim Jong Il in 2011. Bloomberg , citing three unidentified sources, also reported that Kim was in Beijing. Neither China nor North Korea has made an official statement on the matter. A senior US official who follows North Korea closely said the available evidence suggested that Kim had travelled to Beijing to meet Chinese President Xi Jinping, but stressed that had not yet been confirmed. It would mark Kim's first trip outside the isolated country since he took power 2011. The unconfirmed visit also comes ahead of a potential summit with President Donald Trump. South Korea said it did not know the official's identity but was closely watching events. "The presidential Blue House is watching things in Beijing very closely while keeping all possibilities open," said a senior official in Seoul, who spoke on condition of anonymity.
Media: EuronewsANALYST'S TAKE: "For good reasons, U.S. markets rose overnight and this change looks set to play into higher Asia Pacific markets into the end of the week," said Jingyi Pan of IG in a report. "However, eyes remain on key items including the Bank of Japan and the two Koreas' meetings alongside a slew of data to keep us occupied."
JAPAN ECONOMY: Japan's central bank left its ultra-easy monetary policy and inflation forecast unchanged. The Bank of Japan's short-term policy interest rate is negative 0.1 percent and it aims to keep the yield on 10-year government bonds at zero percent. The meeting was the first since BOJ Gov. Haruhiko Kuroda began a new five-year term this month.
EURO ZONE: The head of the European Central Bank says recent signs of weakening economic growth are grounds for caution but not worrisome enough yet to consider changing the bank's stimulus and interest rate policy. Mario Draghi said data point to "some moderation" in growth in the 19 countries that use the euro, while remaining "consistent with a broad-based expansion." Draghi noted the potential for damage from tensions over trade, which have grown since U.S. President Donald Trump announced tariffs on some imports.
JAPAN MANUFACTURING: Japanese factory output rose by an unexpectedly strong 1.2 percent in March from a month earlier while retail spending declined 0.7 percent. It was the second monthly gain in factory activity following a plunge in January. However, output declined in the January-March quarter. Demand for labor increased but manufacturers reported inventories also rose, suggesting they may cut production in coming months.
ENERGY: Benchmark U.S. crude fell 22 cents to $67.87 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 14 cents on Thursday to close at $68.19. Brent crude, used to price international oils, shed 22 cents to $73.66 per barrel in London. It jumped 65 cents the previous session to $73.88.
CURRENCY: The dollar declined to 109.17 yen from Thursday's 109.29 yen. The euro edged up to $1.2110 from $1.2104.