Asian Shares Advance On Earnings Optimism

Asian stocks rose broadly on Wednesday as investors cheered strong earnings from Alphabet and Amazon.com as well as positive news related to Covid-19 vaccine supplies and U.S. stimulus plans.

Chinese markets slipped as the People’s Bank of China drained some funds from the financial system and a private survey showed China’s services sector activity grew at its slowest pace in nine months in January.

The benchmark Shanghai Composite index dropped 16.38 points, or 0.46 percent, to 3,517.31, while Hong Kong’s Hang Seng index ended up 58.76 points, or 0.20 percent, at 29,307.46.

Japanese shares closed higher despite the government extending a coronavirus state of emergency in Tokyo and nine other areas through March 7.

With domestic companies and global IT firms reporting robust earnings, investors shrugged off data showing that Japan’s services sector shrank at the fastest pace in five months in January.

The Nikkei average edged up 284.33 points, or 1.00 percent, to 28,646.50, while the broader Topix index closed 1.30 percent higher at 1,871.09.

Mitsubishi Motor surged 11.3 percent after the company upgraded its full-year earnings guidance. Similarly, Panasonic jumped 3.8 percent after raising its earnings forecasts for the current year through March.

Australian markets ended notably higher, with financials leading the surge on RBA’s upbeat economic outlook.

The benchmark S&P/ASX 200 index climbed 62 points, or 0.92 percent, to 6,824.60, while the broader All Ordinaries index closed 0.90 percent higher at 7,090.90.

The big four banks rose between 1.2 percent and 1.9 percent while miners BHP and Rio Tinto dropped 1-2 percent as iron ore prices descended from recent highs on weak Chinese demand ahead of the Lunar New Year holidays.

Santos, Origin Energy, Beach Energy and Oil Search gained 1-2 percent after oil prices hit their highest in a year on supply cuts.

In economic news, the total number of building permits issued in Australia jumped a seasonally adjusted 10.9 percent sequentially in December, while services sector activity in the country expanded at a slower rate in January, separate reports showed.

Seoul stocks rose for the third day running as foreign investors continued their buying streak on expectations of a speedy economic recovery in Asia and globally.

The benchmark Kospi jumped 32.87 points, or 1.06 percent, to close at 3,129.68 after gaining more than 4 percent in the past two sessions.

Hyundai Motor rallied 2.1 percent and its affiliate Kia Motors soared 9.7 percent on reports that Kia may have seen some progress in its talks with Apple Inc. for potential partnership in developing electric cars. Auto parts maker Hyundai Mobis advanced 3.9 percent.

New Zealand shares eked out modest gains after the statistics agency delivered the fourth-quarter employment numbers showing that the island nation’s fourth- jobless rate unexpectedly dropped in the fourth quarter. The benchmark NZX-50 index rose 46.71 points, or 0.36 percent, to 13,091.21.

U.S. stocks posted strong gains overnight as concerns over a speculative trading mania eased and investors kept a close watch on progress in stimulus talks.

The Dow Jones Industrial Average and the tech-heavy Nasdaq Composite both climbed around 1.6 percent, while the S&P 500 added 1.4 percent.