Asia report: Markets finish mixed, South Korea leads gains

Markets in Asia finished in a mixed state on Thursday, with stocks in South Korea leading the gains, as investors reacted to a stellar session on Wall Street overnight which saw the Dow Jones Industrial Average reach a fresh record high.

In Japan, the Nikkei 225 was up 1.67% at 30,168.27, as the yen weakened 0.19% against the dollar to last trade at JPY 106.07.

Of the major components on the benchmark index, robotics specialist Fanuc was up 5.65%, Uniqlo owner Fast Retailing added 2.38%, and technology giant SoftBank Group was 3.84% firmer.

Carmaker Suzuki Motor was down 3.3% by the end of trading in Tokyo, after it announced on Wednesday that chairman Osamu Suzuki would step down in June to become a senior advisor to the firm.

The broader Topix index rose 1.22% to end its session at 1,926.23.

On the mainland, the Shanghai Composite added 0.59% to 3,585.05, and the smaller, technology-heavy Shenzhen Composite was 0.51% weaker at 2,335.40.

South Korea’s Kospi surged 3.5% to 3,099.69, while the Hang Seng Index in Hong Kong was 1.2% firmer at 30,074.17.

Both of the blue-chip technology stocks were on the front foot in Seoul, with Samsung Electronics up 4.02%, and SK Hynix rocketing 9.19%.

The gains for the chipmaker came on the back of forecast-busting fourth quarter revenue and earnings from American graphics card giant Nvidia overnight.

Those figures come in the context of a major shortage of semiconductors globally, which has affected a large number of sectors.

Emerging markets-focussed bank Standard Chartered closed down 1.9% in Hong Kong, meanwhile, after it reported a 57% fall in pre-tax profit for 2020, to $1.61bn.

That was lower than the $1.85bn that had been pencilled in by analysts, although chief executive officer Bill Winters was rosy about the bank’s outlook.

“While Covid-19 caused the quickest and sharpest economic collapse any of us has ever seen, recovery expectations have also surpassed prior recessions in both speed and magnitude,” Winters said.

“We are in a great position to benefit from that.”

Sentiment began the day positively in Asia, after the Dow reached a new record close of 31.961.86 stateside.

The bumper session on Wall Street came as US Federal Reserve chair Jerome Powell gave testimony to the House Financial Services Committee, telling congressmen that inflation could be turbulent as the economy reopened and recovered.

He did note that he was not expecting inflation to be high, however, adding that the central bank was prepared to act should it head too far northwards.

“Risk assets are enjoying one of their best days in some time as Federal Reserve chair Powell continued to dispel inflation fears, while signalling that the central bank would keep policy accommodative for some time to come,” said Axi chief global market strategist Stephen Innes.

“Asian markets took the Wall Street lead and painted the ticker tape green.”

Innes said that usually, market participants were keen to read what they wanted to read in Fed commentary.

“However, with both Fed chair Powell and vice-chair Clarida singing from the same song sheet, they left little to the imagination as the FOMC are in total sync on monetary policy's current posture.

“Extremely loose and comfortable might best describe that fit.”

Oil prices were higher as the region went to bed, with Brent crude last up 0.31% at $67.25 per barrel, and West Texas Intermediate rising 0.25% to $63.38.

In Australia, the S&P/ASX 200 managed gains of 0.83% to 6,834.00, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was 1.15% lower at 12,140.66.

The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.44% at AUD 1.2495, and the Kiwi advancing 0.19% to NZD 1.3411.