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BANGKOK (AP) — Asian stocks rose Tuesday as Wall Street rallied to recoup nearly all of its losses from a weak start to the year.
US futures and oil prices fell.
Tokyo’s Nikkei 225 index rose 1.2% to 33,763.18 after markets reopened from the holiday on Monday.
Hong Kong’s Hang Seng rose 0.3% to 16,267.72, regaining ground lost in recent declines. The Shanghai Composite Index rose 0.4% to 2,896.11.
South Korea’s Kospi fell 0.3% to 2,561.24, while Australia’s S&P/ASX 200 rose 0.9% to 7,520.50.
Wall Street rose broadly on Monday as easing in U.S. Treasury yields eased pressure on stock markets. The rally was led by Big Tech stocks, which were a major driver of Wall Street’s rise last year, when a handful of stocks accounted for most of the S&P 500’s returns amid excitement around artificial intelligence technology. But it stumbled last week amid a widespread market pullback.
The S&P 500 rose 1.4% to 4,763.54. It returned to within 0.7% of its record and regained momentum after recording its first losing week in the past 10 weeks.
The Nasdaq Composite Index rose 2.2% to 14,843.77, and the Dow Jones Industrial Average rose 0.6% to 37,683.01.
Boeing Co. dragged the Dow down in early trading after one of its jets exploded over Oregon. It fell 8%. Spirit AeroSystems, which makes airframes and other parts for Boeing Co., fell 11.1%.
Shares of oil and gas companies also weighed on the market after Saudi Arabia lowered the price of crude oil for February delivery, signaling potential weakness in oil demand. Exxon Mobil fell 1.7% and Marathon Oil fell 2.7% as U.S. crude oil fell $3.04 to $70.77 a barrel.
“Weak demand fundamentals influenced this decision in the global physical oil market. The price decline was widely expected, but was actually larger than analysts expected,” said SPI Asset Management. said Stephen Innes in a comment.
NVIDIA announced multiple AI-related products and rose 6.4%. Meanwhile, Apple rose 2.4%, rebounding from its worst week since September. They were the most powerful force pushing the S&P 500 up, along with Microsoft, Amazon, and Alphabet.
Commercial Metals also rose 7.5%, reporting that its latest quarter’s profit beat analysts’ expectations. The report said construction activity is healthy in North America, driving demand for steel and helping offset Europe’s economic downturn.
Further financial results are expected to be released over the weekend. Delta Air Lines, JPMorgan Chase & Co. and UnitedHealth Group will be among the companies Friday to kick off the S&P 500’s reporting season for the final three months of 2023.
The highlight of the week may be the release of the latest inflation data for U.S. consumers on Thursday. The cooling in the region has raised hopes on Wall Street that there will soon be enough improvement for the Federal Reserve to not only stop raising rates, but to start cutting them.
The Fed has already raised its key interest rate to its highest level since 2001 in an effort to combat high inflation, which will strain the economy and depress investment prices.
Those expectations have already pushed U.S. Treasury yields lower in the bond market, which edged lower on Monday. The yield on the 10-year U.S. Treasury note fell to 4.01% from 4.05% late Friday. In October, it exceeded 5%, the highest level since 2007, putting sharp downward pressure on the stock market.
Critics also warn that traders may be too optimistic about how deep the Federal Reserve will cut interest rates this year. The Fed has signaled three potential rate cuts, but many traders are predicting at least six. Critics say the numbers may not be as large unless a recession forces the Fed to intervene.
That has put a lot of focus on corporate profits, where growth could help support stock prices.
Benchmark U.S. crude oil fell 20 cents to $70.57 a barrel in electronic trading on the New York Mercantile Exchange. It fell $2.84 on Monday to $70.77 per barrel.
Brent crude oil, the international standard, fell 7 cents to $76.05 a barrel.
The dollar fell from 144.23 yen to 143.93 yen. The euro rose to $1.0955 from $1.0949.
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