Global Markets Rise to Begin the Week

By FeaturesDow Jones Newswires

Early strength in financial stocks drove gains in Japan and Australia as investors reacted to prospects of a completed tax bill getting through the U.S. Congress this week.

Bitcoin was in focus again, as trading began for the cryptocurrency on the world's largest futures exchange.

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Futures prices were initially above $20,000 on the CME before pulling back, and bitcoin itself slumped in Monday morning Asian trading, according to CoinDesk. It was recently around $18,300, falling from $19,500 earlier, just before futures trading started.

Meanwhile, major Asia-Pacific stock markets had early support from Republicans presenting their tax-reform proposal, which helped U.S. stocks hit fresh record highs on Friday.

The Nikkei climbed 0.9%, aided by 2% gains for some financial stocks. Meanwhile, the yen gave back some of last week's strength, with the U.S. dollar around Yen112.70 versus Yen112.25 at the end of local stock trading Friday.

In Australia, the S&P/ASX 200 gained 0.7%, with Australia & New Zealand Banking Group nearly 2% higher on stock-buyback plans. Commodities also helped, with big mining companies BHP Billiton and Rio Tinto rising more than 1%.

The Republican tax proposal would eliminate the tax on profits made outside the U.S., while requiring companies pay a levy on earnings currently offshore at a much-reduced rate. The current policy has resulted in American companies leaving nearly $1.9 trillion abroad, according to Moody's Investors Service.

Tax experts say companies would bring to the U.S. much of their overseas cash if the rate is cut.

"Christmas will come early if the tax reforms translate to legislation," said Shane Chanel, an equities and derivatives adviser at ASR Wealth Advisers.

Stock indexes were slightly lower in New Zealand, Taiwan and Korea. Oil futures were little changed, with the U.S. benchmark up 0.1% and Brent essentially flat.

S&P 500 futures were recently up 0.2%.

Some said profit-taking to end 2017 may not be as consequential as it has been in years past.

"These 'Santa rallies' could be shallow given details of the 'compromise' tax bill have been suggested (and arguably digested) by the markets for some time now," said Vishnu Varathan, head of economics and strategy at Mizuho Bank.

Investors are awaiting election results from two states in India. Exit-poll data on Friday indicated Prime Minister Narendra Modi would solidify his position there, which led to rallies in stocks and the rupee.

Gregor Stuart Hunter contributed to this article.

Write to Kenan Machado at kenan.machado@wsj.com

(END) Dow Jones Newswires

December 17, 2017 21:06 ET (02:06 GMT)