ASIA MARKETS: Asian Markets Starting Off The Week Strong

By Ese ErherieneFeaturesDow Jones Newswires

Nikkei back above 20,000, Hang Seng up 1%

Stock markets were higher in Asia early Monday, with resilience in U.S. equities helping to improve risk appetite at the dawn of an action-packed week.

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Among other events, investors will be focused on the start of formal Brexit negotiations and a decision on whether to include China's domestically-traded A-shares in MSCI's emerging-market index, which is widely followed.

Shares also held steady as London police said they were dealing with a "major incident" involving a vehicle that collided with pedestrians, resulting in a number of casualties. One person has been arrested.

The Nikkei Stock Average was up 0.6% in early trade, with a softer yen aiding a move back above 20,000 points. Australia's S&P/ASX 200 was up 0.5%, Korea's Kospi added 0.6% and Hong Kong's Hang Seng Index gained 1%.

"Trailing in the glow of buoyant U.S. markets, Asian bourses [found] moderate gains to start the week," said Jingyi Pan, a market strategist at IG Group. On Friday, the Dow Jones Industrial Average ended up 0.1%, while the S&P 500 also recorded slight gains.

In Japan, economists had expected a modest trade surplus for May. Instead, the country reported its first deficit since January. A finance ministry official noted it wasn't uncommon for Japan to post a deficit in May because many manufacturers shut down factories during the "Golden Week" holidays, which limits exports.

Still, local stocks shrugged off the report as the exports data in Japan "continue to reinforce the growth story for Japan's economy," said Pan.

Japan's exports jumped 14.9% for May from a year earlier, the biggest rise since January 2015, marking the sixth consecutive month of increases, the government said Monday. Still, the figure came in lower than an 18.2% increase expected by economists polled by The Wall Street Journal.

Shares of Japanese auto-parts maker Takata (7312.TO) were ask-only, meaning no shares have traded because sell orders have overwhelmed buys. The company is in the final stages of preparing to file for bankruptcy protection to address mounting liabilities from its rupture-prone air bags. The company's shares are down 44% this year.

Across the region, technology stocks continued to rebound after logging losses in several sessions last week. The Kospi IT subindex was 1.3% higher, while Taiwan's Taiex Technology Index added 0.2%.

In currencies, the yen was down 0.1% which eased pressure on exporter stocks by making it cheaper for companies to ship their goods around the world. Among individual stocks, Mitsubishi Motors (7211.TO) rose 0.8% and Sony (6758.TO) added 1.9%.

In the commodities market, oil prices pulled back in Asia after ending in positive territory last week. July Nymex was down 0.3% at $44.60 a barrel, while August Brent fell 0.2% to $47.25.

Data out Friday afternoon in the U.S. showed another week of rising active U.S. oil-drilling rigs, but some traders say at this level, prices may be close to a floor.

"Questions on the U.S. shale's ability to keep profitable are being asked," after oil earlier hit its lowest point since November, said Stuart Ive, a client manager at OM Financial.

(END) Dow Jones Newswires

June 18, 2017 23:22 ET (03:22 GMT)