Asian Shares Rise as Attention Shift to Second Trump-Kim Summit

By Investors Hub

Asian stocks closed mostly higher on Wednesday as investors welcomed dovish comments on monetary policy from Fed Chairman Powell and eagerly looked forward to the second summit between U.S. President Donald Trump and North Korean leader Kim Jong Un in Vietnam.

Chinese shares ended higher after Powell reiterated the U.S. central bank would stay patient on monetary policy in the face of economic headwinds.

The benchmark Shanghai Composite Index rose 12.31 points or 0.4 percent to 2,953.82, although Hong Kong’s Hang Seng Index ended edged down 14.62 points or 0.1 percent to 28,757.44.

Japanese shares ended higher as gains in the defensive sector offset profit taking in China-related stocks. The Nikkei 225 Index climbed 107.12 points or 0.5 percent to 21,556.51, while the broader Topix closed 0.2 percent higher at 1,620.42.

Pharma and realty stocks gained ground, with Takeda Pharmaceutical, Daiichi Sankyo and Mitsui Fudosan rising 2-4 percent. Komatsu, Keyence Corp. and Yaskawa Electric dropped 1-2 percent.

Australian markets eked out modest gains as higher commodity prices on the back of a weaker U.S. dollar supported mining stocks. The benchmark S&P/ASX 200 Index rose 21.90 points or 0.4 percent to 6,150.30, while the broader All Ordinaries Index ended up 24.60 points or 0.40 percent at 6,233.60.

Mining giant Rio Tinto rose 0.6 percent ahead of its full-year earnings announcement, while BHP added 0.4 percent.

Woodside Petroleum, Beach Energy and Santos gained over 1 percent as oil prices bounced back on news that OPEC plans to continue production cuts despite comments from Trump.

The big four banks rose between half a percent and 0.9 percent. Bubs Australia soared 4.4 percent after it announced a long-term supply agreement with Bega Cheese subsidiary Tatura.

On the economic front, official data showed that the value of construction work completed in Australia fell a seasonally adjusted 3.1 percent sequentially in the fourth quarter of 2018, missing forecasts for an increase of 0.5 percent.

Seoul stocks closed modestly higher as investors eagerly awaited the outcome of the summit between Trump and Kim. The benchmark Kospi gained 8.19 points or 0.4 percent to finish at 2,234.79.

Carmakers led the surge as Hyundai Motor Group rejected demands by U.S. activist investor Elliott Management for a combined 7 trillion won ($6.3 billion) dividend payout.

Hyundai Motor shares rallied 5.3 percent, its affiliate Kia Motors advanced 1.5 percent and auto parts maker Hyundai Mobis added 3.8 percent. On the flip side, steelmaker Posco fell 2.7 percent.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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