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Asia markets buoyed by Wall Street momentum

Wednesday 03:00 BST

Overview

Momentum from a buoyant Wall Street carried over into Asia trading as equities rallied while bonds and oil prices continued to slide.

Hot topic

Stock markets across the region took their cues from Wall Street, where on Tuesday the S&P 500 neared a record closing high and the tech-focused Nasdaq closed above 6,000 for the first time.

In Sydney, the S&P/ASX 200 was up 0.8 per cent on rallies in the information technology, financials and energy segments.

Shares in New Zealand’s a2 Milk Company rose as much as 6.4 per cent after it revised its sales expectations for the second half higher on strong sales in China and Australia. BHP Billiton climbed as much as 1.3 per cent after the miner flagged the sale of some of its US gas fields amid an activist battle. The Anglo-Australian miner cut also production guidance for copper, iron ore and coking coal in 2017.

Tokyo’s Topix index was up 0.7 per cent, with Hitachi Kokusai Electric up 8.5 per cent on reports that its parent Hitachi was considering options for its chipmaking unit including a sale.

In Hong Kong, the Hang Seng was up 0.4 per cent as casino stocks rallied, with Galaxy Entertainment and rival Sands China each up 1.8 per cent.

Forex

Asia-Pacific currencies continued to weaken against the greenback, though the dollar index — measuring the US currency against a basket of peers — was flat at 98.814, leaving it down 1.2 per cent week-to-date.

The Australian dollar was 0.3 per cent weaker against its US counterpart at $0.7512 after consumer price data for the March quarter showed that inflation had re-entered the central bank’s target range for the first time since 2014.

The Japanese yen continued to soften against the dollar, weakening as much as 0.3 per cent to ¥111.39 before paring losses to trade down 0.1 per cent at ¥111.22.

Fixed income

Downward pressure on sovereign bonds continued into Asia trading, with prices falling and yields rising.

Australian government bonds were faring worst in the region, with the 10-year yield rising 5 basis points to 2.635 per cent. The equivalent New Zealand note was similarly affected, with its yield rising 4 bps to 3.049 per cent.

Northeast Asian bonds were somewhat better off, with the yield on 10-year Japanese government bonds up 1 bp at 0.02 per cent and that for the 10-year South Korean note up 2 bps at 2.198 per cent.

The yield on 10-year US Treasuries was flat at 2.336 per cent, near a three-week high after rising 9 bps over the previous two sessions.

Commodities

Oil prices were slipping in the face of concerns about high global inventories, with Brent crude, the global benchmark, down 0.4 per cent at $51.88 a barrel. US marker West Texas Intermediate was down by the same amount at $49.33.

Gold was flat at $1,264.42 per ounce after falling 1 per cent on Tuesday. The yellow metal is down 1.6 per cent this week.

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