Asian stocks tipped to march higher on back of strong global economy

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Traders work on the floor of the New York Stock Exchange as the tech-heavy Nasdaq index notched another record and should give Asian stocks a boost on Wednesday. Photo: EPA

Published: 7:49am, 10 May 2017Updated: 7:49am, 10 May 2017

Stocks in Asia look set to gain on Wednesday, spurred by bets that the global economy can withstand higher US interest rates as early as next month.

Equity-index futures in Japan, Hong Kong and Australia all pointed to gains. The S&P 500 Index slipped from a record, while technology shares pushed the Nasdaq Composite Index to an all-time high. The greenback traded at the highest in a month on Tuesday in the wake of hawkish comments from Federal Reserve officials.

Safe haven assets caught a bid, with the yen strengthening, after Sky News reported North Korea will proceed with a nuclear test. Markets in India, Malaysia, Sri Lanka, Singapore and Thailand are closed for holidays.

Japan’s Nikkei 225 Stock Average is closing in on the 20,000 level, and AMP Capital Investors Ltd said cheap valuations will allow for further gains. The start of trading in China will be closely watched after a rout that’s caused more than US$500 billion in damage took a pause on Tuesday.

Women walk past an electronic stock indicator of a securities firm in Tokyo on Tuesday. Photo: AP

Optimism for global economic growth is helping drive down expectations for volatility in equity and fixed-income markets. China data on consumer and producer prices provide the latest figures for investors to assess Wednesday. With global stocks trading near record highs, earnings need to keep delivering to appease investors getting restless about higher equity valuations.

South Korea’s stock market reopens after Moon Jae-in declared victory in the country’s presidential election.