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Asian Equities Find Some Solid Ground After Days Of Losses

2018-4-27 09:46:01Basics of Trading
 Asian Equities Find Some Solid Ground After Days Of Losses

Asian stocks generally advanced in early morning trade Friday, looking to recover from losses from Thursday and taking their cue from solid advances in U.S. markets overnight.

Perhaps lending a dose of optimism, Asian markets opened just as North Korean leader Kim Jong-un stepped on South Korean soil to begin a widely anticipated summit, that is going some way towards easing geopolitical tension in the region.

Also supporting stocks was a retreat in yields of U.S. Treasury bonds, with the yield on 10-year notes slipping back below the 3% mark after rising to 3.035% on Wednesday. The fall and a strong results season helped shore up U.S. benchmarks.

The Dow Jones Industrial Average gained 0.99% and the S&P 500 rose 1.04% while the tech-heavy Nasdaq powered up 1.64%, thanks to a recovery in tech stocks.

Stock markets throughout Asia opened the day in a positive note.

The Nikkei 225 was up 0.51% at 9:30PM ET (01:50 GMT),hours before the Bank of Japan was set to complete a two-day review of rates on Friday. The market is generally expecting the BOJ to leave its policy stance intact, maintaining its policy of quantitative and qualitative easing (QQE) with yield control policy.

South Korea;s Kospi was up 0.76% in mid-morning trade, adding on to a solid performance Thursday powered by a strong rebound in Samsung Electronics. Samsung (KRX:KS:005930) rose 2.3% on Thursday after posting another quarter of record profits. At mid-morning Friday, Samsung was trading up 2.49%.

Adding to the positive mood in South Korea, the country recorded first quarter GDP growth of 2.8% from a year earlier.

The mood was less buoyant in Hong Kong, which fell 1.06% on Thursday. Markets in mainland China also gave up ground. Investors expect to see more bearish volatility there and remained concern that trade tensions between China and the U.S. will have a negative impact on growth.

The fears weighed on technology stocks in particular, especially after reports surfaced that the U.S. Department of Justice was investigating telecom equipment maker Huawei Technology Co Ltd (SZ:002502)for breaching sanctions on Iran. Two weeks ago, the U.S. banned ZTE Corp-H (HK:0763), another telecoms maker, from buying U.S. technology for seven years.

Despite the fears, Hong Kong stocks took some cues from elsewhere in Asia and the positive finish in the U.S. and looked to reverse some of the losses from the previous days. The Hang Seng Index was up 0.92% shortly after the opening Friday morning in Asia.

Mainland China bourses have also been struggling to gain momentum. The Shanghai Composite Index was up a modest 0.30% in early morning trade while the Shenzhen Composite Index was up 0.38%.

Elsewhere, Australia’s S&P/ASX 200 in Sidney was up 0.42% after a flat day on Thursday caused by losses in financial stocks.