Asian Shares Advance On Upbeat China Data

Asian stocks advanced on Tuesday after reports emerged that the United States may decide to cut some tariffs on Chinese imports in an effort to tame record-high inflation.

China’s Vice Premier Liu He and U.S. Treasury Secretary Janet Yellen held a virtual call Tuesday about macroeconomic issues, according to official statements from both sides.

Meanwhile, China’s services activity jumped to the highest level in nearly a year in June and Japan’s services activity expanded at the fastest pace since October 2013, briefly easing concerns about slowing global growth.

Chinese shares fluctuated before ending on a flat note, as concerns over a flare-up in COVID-19 cases offset signs of easing Sino-U.S. tensions and upbeat business activity data for June.

The benchmark Shanghai Composite finished marginally lower at 3,404.03 while Hong Kong’s Hang Seng index edged up 0.1 percent to 21,853.07.

Japanese shares rose sharply as investors brought down beaten-down technology and growth stocks, tracking declines in U.S. yields. The Nikkei average climbed 1.03 percent to 26,423.47 while the broader Topix index closed half a percent higher at 1,879.12.

Technology investor SoftBank Group rallied 1.8 percent and Uniqlo owner Fast Retailing surged 4.3 percent. Shipping firms traded weak, with Mitsui O.S.K. Lines and Kawasaki Kisen Kaisha losing 3-4 percent.

Seoul stocks rallied despite inflation in the country rising to a 24-year high in June, fanning expectations of a big rate hike this month. The Kospi average soared 1.80 percent to 2,341.78, snapping a four-day losing streak ahead of the earnings season.

Internet portal operator Naver gained 3.4 percent and platform giant Kakao added 5.7 percent. Vaccine maker SK Bioscience spiked nearly 25 percent after the country reported over 18,000 new COVID-19 cases in the past 24 hours.

Australian markets eked out modest gains as the Reserve Bank raised its cash rate by 50 basis points to 1.35 percent, its third successive increase to combat inflation, and flagged more tightening ahead.

The benchmark S&P/ASX 200 rose 0.25 percent to 6,629.30 while the broader All Ordinaries index inched up 0.31 percent to 6,818.10. Energy stocks topped the gainers list followed by information technology stocks.

Across the Tasman, the benchmark S&P NZX-50 index closed 0.95 percent higher at 10,965.17. Heavyweights Fisher & Paykel Healthcare and Mercury NZ both rose about 4 percent.

U.S. markets were closed on Monday for the Independence Day holiday.