Stock market today: Asian stocks track Wall Street gains ahead of earnings reports

HONG KONG — Asian stock benchmarks were mostly higher on Tuesday after US shares pared some of their losses from the previous week.

U.S. futures were mixed and oil prices rose.

Japan’s benchmark Nikkei 225 rose 0.3% to 37,552.16, despite the country’s manufacturing activity contracting for 11 months in a row and nearing breakeven in April.

A survey among purchasing managers showed that sentiment was 49.9, on a scale of maximum 100, with 50 marking the break between expansion and contraction. The yen weakened further, hitting a new 34-year low at 154.85 early Tuesday.

Hong Kong’s Hang Seng rose 1.6% to 16,771.17, while the Shanghai Composite index fell 0.8% to 3,019.64.

The Australian S&The P/ASX 200 rose 0.4% to 7,683.50. South Korea’s Kospi fell 0.2% to 2,624.73.

On Monday the S&The P500 rose 0.5% to 5,010.60, recovering more than a quarter of last week’s loss. The Dow Jones Industrial Average rose 0.7% to 38,239.98, and the Nasdaq composite rose 1.1% to 15,451.31.

The rally was widespread and most stocks on Wall Street rose. In the “S&P500, tech stocks led the way, rebounding from their worst week since the 2020 COVID crash.

Nvidia rose 4.4% and Alphabet rose 1.4% as government bond yields stabilized in the bond market. Last week, a jump in yields increased pressure on stocks, especially those considered the most expensive, leaving their investors waiting the longest for big growth.

Bank stocks were also strong after some encouraging earnings reports. Truist Financial rose 3.4% after its early-year profit beat analyst expectations.

They helped offset a 3.4% decline for Tesla, which announced further price cuts this weekend. Elon Musk’s electric vehicle company has already seen its shares fall more than 40% this year and will report its first-quarter results later today.

It’s generally a big week for earnings reports, with about 30% of companies in the S&P500 would say how much they earned during the first three months of the year. This also applies to companies that have become known as part of the ‘Magnificent Seven’, alongside Tesla and Alphabet.

The difference in growth between the Magnificent Seven and the rest of the S&The P500 should close by the end of the year, strategists Ohsung Kwon and Savita Subramanian said in a report from BofA Global Research.

Verizon Communications helped kick off this week’s reports by announcing an earnings decline that wasn’t as bad as analysts expected. It cited price increases and other measures to support its revenues. Verizon shares swung from an early gain to a 4.7% loss after it reported weaker-than-expected first-quarter revenue and kept its full-year profit forecast unchanged.

Even more pressure than usual is being put on companies to achieve greater profits and revenues. That’s because the other big factor driving stock prices, interest rates, isn’t likely to provide much help in the short term.

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.

In oil trading, U.S. crude rose 16 cents to $82.06 a barrel. Brent crude, the international standard, rose 18 cents to $87.18 a barrel.

The US dollar fell from 154.84 yen to 154.78 Japanese yen. The euro fell from $1.0653 to $1.0646.