Stocks Extend Gains After Starting 2018 on a High Note — Update
By Kenan Machado
Asian equities overcame early weakness in some markets to trade broadly higher Monday, extending last week’s global stock rally.
Indexes in Hong Kong, China and Taiwan opened lower, weighed by fresh regulatory steps in China, while others in the region rose further.
But Taiwan’s Taiex was at fresh 28-year highs by midday and the Shanghai Composite Index ended morning trading up 0.3%, on track for its seventh straight session of gains.
Tommy Xie, an economist at OCBC Bank in Singapore said the latest proposals by China’s banking regulator send a clear message that fundamentals and transparency will be the course for China’s commercial banks to contain financial risks.
Major Chinese banks pared early weakness by midday in Hong Kong, with Bank of China and China Construction Bank each down about 0.5%.
The Hang Seng Index was roughly flat, supported by a jump in Chinese property developers. Country Garden rose 7% to hit fresh record highs.
Broadly in the region, “there are no signs of a pullback yet,” said Margaret Yang, a market analyst at CMC. Asian equities should maintain a positive outlook as major markets appear set to keep building on recent gains, she added.
South Korea was briefly the best-performing market Monday, with the Kospi up as much as 0.7% as the Korean won fell 1% against the dollar during a 10-minute stretch of midmorning trading. Traders blamed the currency weakness on central-bank intervention, as the won had been at its strongest levels versus the dollar since 2014.
But the benchmark pared early gains and was recently trading just 0.2% higher as index heavyweight Samsung fell 0.8%.
Australia’s S&P/ASX 200 hit a new 10-year high Monday. The index advanced 0.1%, helped by gains in the country’s big banks.
New Zealand’s NZX 50 benchmark ended down 0.4% after setting three straight record closing highs last week.
Japanese markets were closed Monday for a holiday.
Oil futures started the week higher, reversing some of Friday’s pullback. Both the U.S. and global benchmarks were 0.3% higher in early Asian trading.
Bitcoin continued to pull back, recently changing hands around $15,700, according to CoinDesk. It was at $17,000 over the weekend.
Write to Kenan Machado at [email protected]