Stock market today: Asian shares track Wall Streets rally, led by a 2.4% jump in Tokyo
HONG KONG — Asian shares followed Wall Street’s rally, led by a 2.4% rise for Tokyo’s Nikkei 225 index, driven by strong gains for semiconductor makers.
U.S. futures rose as oil prices moved higher.
Japan’s benchmark Nikkei 225 gained more than 900 points to close at 38,460.08, its highest level in a month.
The shares of computer chip company Renesas Electronics Corp. rose 10.5%, while rival Tokyo Electronic rose 7.1%.
Investors are watching Japan’s central bank and finance ministry respond to prolonged weakness in the yen, which has been trading at a 34-year low, at a policy meeting starting Thursday.
“Market participants will be closely watching updates at this week’s policy meeting for clues on how the Bank of Japan might address currency pressures,” Anderson Alves of ActivTrades said in a commentary.
Shares in Greater China also rose.
Hong Kong’s Hang Seng rose 2% to 17,158.55, while the Hang Seng Tech Index gained 3.1%. Shares of Chinese artificial intelligence company Sensetime Group rose 31.2% after it released the latest version of its SenseNova generative AI model on Tuesday.
But the Shanghai Composite index posted a meager gain, rising 0.3% to 3,031.83.
Taiwan’s Taiex gained 2.7%.
In South Korea, the Kospi rose 1.9% to 2,673.78, led by a 3.4% gain in heavyweight Samsung Electronics.
The Australian S&The P/ASX 200 index rose 0.1% to 7,690.70 after the fifth consecutive quarter of declining inflation, with the consumer price index falling to 3.6% from 4.1% in the first quarter.
On Tuesday the S&The P500 climbed 1.2% to 5,070.55, further emerging from the hole created by a six-day losing streak. The Dow Jones Industrial Average rose 0.7% to 38,503.69, and the Nasdaq composite rose 1.6% to 15,696.64.
A weaker-than-expected report on US business activity helped support the market, which is still in an uncomfortable phase. The hope on Wall Street is that the economy will avoid a severe recession but not remain so hot that upward pressure on inflation remains.
A preliminary report by S&P Global, which was released on Tuesday, seemed to hit that sweet spot. Treasury yields fell in the bond market, and stock prices added to gains immediately after the release.
A flurry of earnings reports also dictated much of the trading, highlighted by a slew of companies beating analyst expectations.
GE Aerospace rose 8.3% after raising its full-year profit forecast, while also beating expectations for first-quarter earnings.
Kimberly-Clark gained 5.5% after the makers of Huggies, Kleenex and Kotex also raised their full-year profit forecast. General Motors rose 4.4% after citing higher profit sales of pickup trucks and other vehicles. Danaher rose 7.2% after highlighting the strength of its bioprocessing and molecular diagnostics businesses.
They helped overshadow an 8.9% decline for Nucor after the steelmaker failed to meet expectations for both profit and revenue.
Because skeptics still call the broad stock market too expensive, criticism would only diminish if companies posted higher profits or if interest rates fell. The latter seemed less likely.
Top Federal Reserve officials warned last week that they may have to keep interest rates high for a while to ensure inflation returns to the 2% target. That was a major letdown for financial markets, erasing hopes raised after the Fed previously signaled there might be three rate cuts this year.
Lower interest rates appeared to be on the horizon after inflation cooled sharply last year. But a series of reports this year showing that inflation has remained higher than expected has raised concerns about stagnant progress.
The yield on the 10-year government bond fell to 4.59% to ease pressure on stocks in general, especially high-growth and high-dividend stocks.
In oil trading, U.S. benchmark crude added 27 cents to $83.63 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, rose 11 cents to $87.50 a barrel.
The US dollar rose from 154.82 yen to 154.90 Japanese yen. The euro rose from $1.0699 to $1.0700.