Asian Shares Extend Gains On Vaccine Optimism

Asian stocks ended mostly higher on Tuesday, as concerns about volatile retail trading receded and investors expressed hopes that declining coronavirus cases and vaccine rollouts will support the near-term economic recovery. Optimism about talks regarding U.S. stimulus also boosted sentiment.

Chinese shares ended notably higher and short-term money rates eased to two-week lows as signs of liquidity tension in the interbank money markets started to fade. The benchmark Shanghai Composite Index rose 28.40 points, or 0.8 percent, to 3,533.68, while Hong Kong’s Hang Seng Index ended up 355.84 points, or 1.2 percent, at 29,248.70.

Japanese shares extended gains from the previous session on optimism around U.S. stimulus plans and hopes for robust earnings. The Nikkei 225 Index ended up 271.12 points, or 1 percent, at 28,362.17 amid reports that the government will extend a state of emergency for Tokyo and surrounding cities for another month.

The broader Topix closed 0.9 percent higher at 1,847.02. Sony and Central Japan Railway Co. rose over 3 percent each, while Keyence Corp. and Hoya Corp. fell around 2 percent.

Tech stocks surged, with Advantest climbing 4.3 percent and Tokyo Electron rising 2.1 percent. Japan Airlines rallied 2.2 percent despite the airline reporting a loss for the nine-month period and forecasting a wider loss for the full year.

Australian markets rallied as the country’s central bank left its key interest rate unchanged and increased the size of its asset purchase program.

The benchmark S&P/ASX 200 Index jumped 99.60 points, or 1.5 percent, to 6,762.60, while the broader All Ordinaries Index ended up 104.70 points, or 1.5 percent, at 7,027.50.

The big four banks rose 1-2 percent after the Reserve Bank of Australia said it does not expect to raise interest rates until 2024. Miners jumped 2-3 percent despite a drop in iron ore prices.

Tech stocks also rose broadly, with Afterpay surging 7.9 percent and Appen climbing 4.5 percent. Woodside Petroleum and Santos gained over 2 percent after crude oil prices rose overnight.

Healthcare stocks came under selling pressure, with biotech firm CSL giving up 1.3 percent. Silver miners succumbed to selling pressure as futures contracts for silver fell 2 percent in Asian trading after touching an eight-year high overnight. Investigator Resources lost 20.9 percent and Argent Minerals slumped 26.4 percent.

Seoul stocks rose for the second straight session, joining a global rally helped by easing concerns about tight liquidity conditions in China.

The benchmark Kospi surged up 40.28 points, or 1.3 percent, to 3,096.81. Tech heavyweights paced the gainers, with Samsung Electronics rising 1.7 percent and SK Hynix climbing 4 percent.

Consumer prices in South Korea were up 0.6 percent year-on-year in January, Statistics Korea said. That beat forecasts for a gain of 0.3 percent and was up from 0.5 percent in the previous month.

On a monthly basis, consumer prices jumped 0.8 percent – again exceeding expectations for 0.5 percent and up from 0.2 percent in the previous month.

New Zealand gains gave up early gains to end modestly lower. The benchmark NZX-50 Index ended down 52.75 points, or 0.4 percent, at 13,044.50, with healthcare stocks taking a beating.

U.S. stocks rallied overnight as the Reddit retail frenzy turned its attention to silver and Covid-19 relief talks progressed on Capitol Hill.

The Dow Jones Industrial Average rose 0.8 percent, the S&P 500 climbed 1.6 percent and the tech-heavy Nasdaq Composite soared 2.6 percent.

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