Asians stocks mostly higher as Japan leads on stimulus hopes

by Frankie Norman July 23, 2016, 7:02

MSCI's broadest index of Asia-Pacific shares outside Japan.MIAPJ0000PUS was up 0.1 percent, nudging back toward last week's nine-month highs, after reassuring earnings overnight helped send both the Dow Jones industrial average .DJI and the S&P 500 .SPX to record highs. The Nasdaq composite rose 53.56, or 1.1 percent, to 5,089.93. It had been below $44 earlier in the day.

HIT THE BRAKES: Shares of electric auto maker Tesla skidded after investors weren't impressed with CEO Elon Musk's "master plan" for the company, which was posted on Tesla's website late Wednesday. The index is still up 0.8 percent in a week in which it touched an eight-week high thanks to an initially weaker yen and hopes of fiscal and monetary stimulus.

Several reports on the US economy have also come in better than expected in recent weeks, which has helped stock indexes reach record highs. But while the data has often topped analysts' forecasts, they still haven't been all that strong. Real estate companies in Hong Kong, where borrowing costs tend to move in tandem with the US, have boosted the equity rally. That could keep stocks hemmed in, says Rich Weiss, senior portfolio manager at American Century. Prime Minister Shinzo Abe has kept markets guessing on the details of a much-anticipated fiscal package as economy minister Nobuteru Ishihara said he'll compile measures later this month. "The case for more easing is evident, and markets are expecting swift and determined action".

Bond and stock markets in Malaysia were relatively unruffled after news that the US Justice Department filed lawsuits linked to scandal-ridden state fund 1MDB with the currency hugging well worn ranges.

The best-performing stock in the S&P 500 was Cintas, which jumped $9.43, or 9.7 percent, to $106.85. REUTERS picAsian stocks dipped early on Friday after weak corporate results halted Wall Street's record run overnight, while the yen held to large gains made after the Bank of Japan's governor downplayed the need for "helicopter money" monetary policies.

So far this reporting season, earnings for almost two out of three companies have come in above analysts' expectations, according to S&P Global Markets Intelligence.

The S&P 500 has been on a steady ride higher since setting a record on July 1, with no days where it has swung by 1 percent during that span.

CHIPPED: Intel fell $1.49, or 4.2 percent, to $34.19 after the chipmaker reported slower revenue growth last quarter than analysts expected.

Data pointed to record USA stockpiles of gasoline and other oil products, when Iraqi crude exports are on the rise, heightening supply glut concerns. Brent crude, the worldwide benchmark, rose 51 cents to $47.17 a barrel. Gold rose $9.40, or 0.7 percent, to $1,328 an ounce.

The major European markets turned in a mixed performance on Thursday. France's CAC 40 slipped 0.3 percent to 4,365.05. South Korea's Kospi lost 0.4 percent and Australian shares dropped 0.2 percent.

SOFTBANK SOFTNESS: Shares in Japanese technology company Softbank Group Corp. slumped 10 percent one day after it announced that it is buying Britain's ARM Holdings for 24.3 billion pounds ($32 billion) in a bid to expand into the "Internet of Things" — or connected home devices.

The yen traded at 105.74 per dollar on Friday after rising 1 percent yesterday. The euro edged up to $1.1010 from $1.1005.

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