ASIA MARKETS: Asian Markets Largely Surge Ahead Despite Global Risks

By Kenan Machado Features Dow Jones Newswires

Nikkei dips, but stocks in China, Hong Kong make gains

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Asian stocks opened largely higher Monday as investors continued to shake off reasons to worry.

Over the weekend, North Korea tested a new type of missile, and a global cyberattack hit computers in business, government and health care.

But regional equities strength has persisted in recent weeks despite concerns including North Korea and China's economy, and continued Monday amid signs of investor hope regarding China.

"Risk-off sentiment is not too strong," said Masashi Murata, a senior currency strategist at Brown Brothers Harriman. Despite weak U.S. inflation data on Friday, the economy there remains steady, he added, auguring well for export-dependent Asian economies.

Asian stock indexes have repeatedly hit multiyear and record highs. But Chinese equities have notably lagged behind amid a government push to rein in speculative and debt-fueled efforts.

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Stocks and bonds there started Monday higher amid signs Beijing is taking a softer approach to reduce leverage and prevent risk in the debt-laden financial system.

China's official Xinhua News Agency ran an unexpected editorial Sunday night that urged financial regulators to avoid enabling the recent campaign to prevent risk to actually create more risk. Meanwhile, Premier Li Keqiang stressed during a cabinet meeting Sunday the importance of striking a balance among maintaining financial stability, gradual deleveraging and stabilizing economic growth.

Ten-year Chinese government bond yields fell to 3.6% from 3.66% on Friday, and the Shanghai and Shenzhen composites gained some 0.4%, among the biggest gains in the region Monday.

Meanwhile, China's flagship forum to promote its "One Belt, One Road," infrastructure program concludes Monday. Beijing has previously sought to stabilize stock markets ahead of important global political gatherings.

Hong Kong's Hang Seng Index rose 0.4% amid gains in companies based in mainland China.

There was some early stock weakness in the region, with Japan, South Korea and Australia opening lower.

After falling some 0.5% minutes after the opening bell, Japan's Nikkei and Australia's S&P/ASX 200 were recently down 0.2% and 0.1%, respectively. Meanwhile, Korea's Kospi was up 0.1% as it looks for what would be that index's eighth record closing high in three weeks.

Away from stocks, oil was a touch higher and the dollar edged up after a pullback during U.S. trading Friday on April's consumer-inflation data.

There are a number of figures coming out of China this week. In data out Monday, retail sales rose a better-than-expected 11% in April from a year earlier, but industrial production fell short with a 6.5% increase.

"Growth momentum has slowed, with signs of moderation seen in the coming quarters," said Zhou Hao, an economist for emerging markets in Asia at Commerzbank. He is among those who think China's 2017 economic growth peaked in the first quarter.

(END) Dow Jones Newswires

May 14, 2017 23:31 ET (03:31 GMT)