Asian stocks rode higher on Wednesday thanks to strong U.S. corporate earnings and hopes China will boost fiscal support for its economy, while long-term U.S. yields hovered near six-week highs on speculation the Bank of Japan could be less accommodative.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.17 percent. The index extended gains from the previous day, when it was lifted after China said it will adopt a more vigorous fiscal policy to help tackle external uncertainties.
Australian stocks dipped 0.1 percent, South Korea’s KOSPI advanced 0.35 percent and Japan’s Nikkei rose 0.5 percent
Overnight on Wall Street, the S&P 500 closed at its highest level since Feb. 1 as Alphabet’s blowout results bolstered expectations of a robust earnings season.
“Gains by U.S. shares are providing support for equities, as well as China’s stimulus plan. Corporate earnings will continue to come out and these will be a key focal point for the markets, which also have to keep an eye on trade developments,” said Soichiro Monji, senior economist at Daiwa SB Investments in Tokyo. In currencies, the dollar index against a basket of six major currencies was little changed at 94.594, having edged up from a near two-week low of 94.207 plumbed at the start of the week on the back of higher U.S. Treasury yields.
The 10-year Treasury note yield stood at 2.950 percent after climbing to a six-week peak of 2.973 percent overnight.
The yield had shot up on speculation the BOJ was edging closer to unwinding its aggressive monetary stimulus, following reports by Reuters and other media late last week that the central bank was holding preliminary discussions on possible changes to its monetary policy.
Channel NewsAsia
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