Asia Markets: Asian markets continue soaring to new highs, but show signs of cooling
The global stock rally continued in Asia early Friday, with numerous markets hitting fresh multiyear highs — though gains show signs of cooling.
Japan’s Nikkei Stock Average NIK, +0.63% , which rose as much as 0.7% early to notch another 26-year best after Thursday’s pop, finished morning trading up 0.2%.
In New Zealand NZ50GR, +0.14% , equities turned lower in afternoon trading following consecutive record-high closes to start 2018, as some large caps eased in holiday-thinned trading. Taiwan’s stock benchmark Y9999, +0.06% , which jumped 1.9% the past three sessions, was slightly weaker most of the morning.
It was a similar story in China and Hong Kong after a sold start to the week. Chinese SHCOMP, +0.23% and Hong Kong stocks were slightly lower by late morning after rising initially; the island’s benchmark Hang Seng Index HSI, +0.18% had gained 0.6% to set another 10-year high.
Thursday’s laggards — Australia and South Korea SEU, +0.99% — outperformed, with their main stock indexes up 0.6% and 0.8% respectively. Oil price gains Thursday — they hit fresh three-year highs — helped the S&P/ASX 200 XJO, +0.76% , while bank stocks also got off the mat after a weak start to 2018. The price of crude oil was slightly lower in Asian trading.
The S&P/ASX 200’s move to fresh 10-year highs came despite news of a surprise November trade deficit, which pushed the Australian dollar down about 0.2%. Capital Economics expects trade to have weighed on the country’s fourth-quarter economic growth.
Stocks broadly “are continuing to track up very nicely and they all appear to be in a relatively strong uptrend,” said Grant Williamson, a broker at Hamilton Hindin Greene. Global economic growth underpins support for equities, though “fundamentals were starting to look a bit stretched” in some markets, he added.
The latest upbeat reading for the U.S. economy came Thursday from an employment release from payroll company ADP showing strong December job growth. The Dow Jones Industrial Average subsequently completed its fastest-ever move to a 1,000-point milestone.
The government’s official unemployment data comes Friday, and OCBC cautioned there could be some profit-taking on Asian markets before the weekend.
S&P 500 futures were recently up 0.05% after the index logged its third-straight record finish to start 2018. It was the longest such streak since the benchmark set best-ever closes the first six sessions of 1964.