Asia rises on Wall St’s record highs, China data misses forecasts
SINGAPORE/TOKYO Asian stocks inched up on Friday, after a surge in oil prices helped propel Wall Street to record highs overnight, while Chinese economic indicators that missed expectations did not dent gains in mainland shares.
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS nudged up 0.2 percent. It was on track to gain 1.9 percent for the week.
Both China’s CSI300 index .CSI300 and the Shanghai Composite .SSEC rose about 0.5 percent after fixed asset investment, retail sales and industrial output all rose but were below expectations. Both indexes were headed for gains of about 1.4 percent for the week.
Fixed asset investment from January to July increased by 8.1 percent from a year earlier, the slowest rate in more than 16 years, compared with expectations for 8.8 percent.
July retail sales increased 10.2 percent, versus 10.6 percent the previous month and a forecast 10.5 percent. Industrial output rose 6.0 percent from a year earlier, slowing from June’s 6.2 percent and just missing forecasts of 6.1 percent.
Hong Kong shares .HSI rose 0.7 percent and were at their highest in more than eight months.
Japan’s Nikkei .N225 rose 0.7 percent on a slightly weaker yen, and is poised to end the week 3.7 percent higher.
South Korea’s Kospi .KS11, which touched the highest level since July 2015, was little changed. Australian stocks gained 0.3 percent.
The S&P 500 .SPX, the Dow .DJI and Nasdaq .IXIC all closed at historic highs on Thursday for the first time since 1999 on higher crude oil and upbeat corporate results. [.N]
The pan-European FTSEurofirst 300 stock index .FTEU3 also jumped, climbing 0.85 percent to its highest close since late May.
MSCI’s 46-country All World index .MIWD00000PUS held close to a one-year high touched overnight.
Supporting investor appetite for risk, oil prices climbed more than 4 percent overnight after a Saudi oil minister hinted at possible action to stabilize prices and triggered a round of buying. [O/R]
They retained that momentum on Friday, with U.S. crude futures up 0.5 percent at $ 43.72 a barrel CLc1, on track to gain 4.5 percent on the week.
Global benchmark Brent crude LCOc1 climbed 0.3 percent to $ 46.18, set to end the week 4.6 percent higher.
“Asia Pacific markets are set to finish the week on a high following strong leads from European and U.S. investors,” wrote Michael McCarthy, chief market strategist at CMC Markets.
“Industrial commodities rose, led by oil, and overnight trading displayed ‘risk on’ characteristics despite the lack of an obvious trigger. Important data from China may change the course of the trading day.”
Global markets will also sift through the string of U.S. data, notably retail sales, due later in the session for latest cues about the world’s largest economy and whether it is robust enough to withstand further monetary tightening.
U.S. retail sales are expected to show a 0.4 percent monthly increase in July, according to the median estimate of 64 economists polled by Reuters. ECONUS
In currencies, the dollar rose after San Francisco Fed President John Williams told the Washington Post that the U.S. central bank should raise rates this year because of improving labor market conditions and the likelihood that inflation is heading higher.
The greenback inched up 0.1 percent to 102.035 yen JPY= after gaining 0.7 percent on Thursday, and is heading for a 0.25 percent weekly rise. The euro was steady at $ 1.11375 EUR= after losing 0.3 percent overnight.
The dollar index, which tracks the greenback against a basket of six major peers, rose 0.1 percent to 95.924, but was on track for a loss of 0.3 percent for the week.
The New Zealand dollar slipped 0.1 percent to $ 0.7202 NZD=D4 after surging on Thursday to $ 0.7351, its highest in more than a year after the Reserve Bank of New Zealand cut rates by 25 basis points to 2.0 percent, a smaller cut than some investors had expected.
The Australian dollar dipped 0.3 percent to $ 0.7678 AUD=D4.