Asian Markets Mostly Higher Amid Cautious Trades

Asian stock markets are mostly higher on Monday, following broadly positive cues from Wall Street on Friday, with upbeat earnings news and strong economic data from the U.S. and China generating continued buying interest and boosting optimism about a solid global economic recovery.

However, traders in the region continue to be cautious amid the surge in coronavirus cases in the region and the possible restrictions on economic activity in several markets. Asian markets closed mostly higher on Friday.

The Australian stock market is modestly higher on Monday, extending gains of the previous three sessions, with the benchmark S&P/ASX 200 hovering just below the 7,100 level at fresh 14-month highs, following broadly positive cues from Wall Street on Friday. Traders are also looking ahead to the RBA’s release of the minutes of its policy meeting on Tuesday.

The benchmark S&P/ASX 200 Index is gaining 12.50 points or 0.18 percent to 7,076.00, after touching a high of 7,094.80 earlier. The broader All Ordinaries Index is up 13.00 points or 0.18 percent to 7,338.80. Australian stocks closed marginally higher or flat on Friday.

Among the major miners, BHP Group is down almost 1 percent, while Rio Tinto is gaining almost 1 percent, while Fortescue Metals and Mineral Resources are up more than 1 percent each.

Oil stocks are lower after crude oil prices declined on Friday. Oil Search is down more than 1 percent, while Woodside Petroleum and Santos are losing almost 1 percent each.

The big four banks are higher. National Australia Bank, Westpac and ANZ Banking are edging up 0.3 percent, while Commonwealth Bank is gaining almost 1 percent.

Among tech stocks, Afterpay is edging up 0.4 percent, while WiseTech Global and Appen are losing almost 1 percent each.

Gold miners are lower after gold prices climbed on Friday. Newcrest Mining is edging up 0.2 percent, Star Resources is gaining more than 1 percent and Evolution Mining is adding more than 2 percent.

Shares in Sims Metal are soaring more than 10 percent after the metal recycler boosted its full-year earnings guidance on strong scrap prices and cost savings. Its underlying EBIT is expected to be between $260 million and $310 million, with a number of the company’s businesses performing strongly. Sims will also return $7.5 million in Jobkeeper payments.

Shares in Orocobre are up more than 4 percent and Galaxy Resources are up almost 2 percent after the the nation’s top lithium producers agreed to a $4 billion merger amid soaring prices and a brighter demand outlook for the key raw material in electric vehicle batteries.

Shares in Kerry Stokes’ Seven Group Holdings are in a trading halt as it is raising $550 million to pay down debt and provide flexibility after the company increased its stake in construction materials firm Boral.

Billionaire casino mogul James Packer is selling his 37 per cent stake in Crown Resorts back to the group under a proposed $3 billion deal funded by private equity giant Oaktree Capital Management. Shares are up almost 1 percent.

In the currency market, the Aussie dollar is trading at $0.773 on Monday.

Japanese stock market is modestly higher after recouping early losses on Monday, with the Nikkei 225 above the 29,700 level, on strong local trade data and broadly positive cues from Wall Street on Friday. However, traders continue to be worried about the rising coronavirus cases and the possible restrictions on economic activity.

The country is considering stricter Covid-19 measures after the nationwide tally surpassed 4000 for a 5th consecutive day on Sunday. Tokyo Governor Yuriko Koike said she might issue a fresh state of emergency for the capital to deal with a recent spike in coronavirus cases.

There are also reports of the possibility of canceling the Tokyo Olympics after the western metropolis of Osaka reported over 1,200 new infections Thursday, the highest since the pandemic began.

The benchmark Nikkei 225 Index closed the morning session at 29,748.10, up 64.73 points or 0.22 percent, after hitting a low of 29,530.84 in early trades. Japanese shares ended marginally higher on Friday.

Market heavyweight SoftBank Group is edging down 0.5 percent and Uniqlo operator Fast Retailing is declining almost 2 percent. Among automakers, Honda is flat and Toyota is edging down 0.4 percent.

The major exporters are mixed. Panasonic is edging down 0.2 percent and Sony is losing almost 1 percent, while Canon and Mitsubishi Electric are edging up 0.2 percent each.

In the tech space, Advantest and Tokyo Electron are gaining more than 1 percent each. In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are edging down 0.5 percent each, while Mizuho Financial is losing more than 1 percent.

Among the other major gainers, Sumco is gaining more than 4 percent, Mitsui OSK Lines is up almost 4 percent and Kawasaki Kisen Kaisha is adding almost 3 percent. Alps Alpine, Seiko Epson, Sumitomo Osaka Cement and Taiheiyo Cement are rising about 2 percent each.

Conversely, Ebara is losing more than 3 percent, while Toho, Shiseido, Japan Exchange Group, Keisei Electric Railway and Daiwa House Industry are down more than 2 percent each.

In economic news, Japan posted a merchandise trade surplus of 663.7 billion yen in March, the Ministry of Finance said on Monday. That exceeded expectations for a surplus of 490.0 billion yen following the downwardly revised 215.9 billion yen surplus in February (originally 217.4 billion yen). Exports jumped 16.1 percent on year to 7.378 trillion yen, beating forecasts for an increase 11.6 percent following the 4.5 percent decline in the previous month. Imports gained an annual 5.7 percent to 6.714 trillion yen versus expectations for 4.7 percent following the 11.8 percent increase a month earlier.

In the currency market, the U.S. dollar is trading in the higher 108 yen-range on Monday.

Elsewhere in Asia, China and Hong Kong are up more than 1 percent each, while New Zealand, Singapore, Taiwan and South Korea are higher by between 0.2 and 0.4 percent. Meanwhile, Malaysia and Indonesia are bucking the trend and are lower.

On Wall Street, stocks moved mostly higher over the course of the trading day on Friday to extend the rally seen in the previous session. With the continued upward move, the Dow and the S&P 500 once again set new record closing highs.

The Dow climbed 164.68 points or 0.5 percent to 34,200.67 and the S&P 500 rose 15.05 points or 0.4 percent to 4,185.47. Meanwhile, the tech-heavy Nasdaq posted a more modest gain, inching up 13.58 points or 0.1 percent to 14,052.34.

The major European markets also moved to the upside on the day. While the German DAX Index surged up by 1.3 percent, the French CAC 40 Index jumped by 0.9 percent and the U.K.’s FTSE 100 Index rose by 0.5 percent.

Crude oil prices drifted lower on Friday, snapping a four-session winning streak but still finishing sharply higher for the week. West Texas Intermediate Crude oil futures for May were down $0.33 or 0.5 percent at $63.13 a barrel, although the contract gained nearly 6.5 percent in the week.

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