Stocks in Hong Kong and Japan jumped to lead Asian markets higher Monday, tracking a positive global lead after key U.S. indexes notched another record finish on Friday, although South Korean shares underperformed amid geopolitical concerns.
Hong Kong’s Hang Seng Index HK:HSI +1.78% climbed 1.6% as the market reopened after Friday’s holiday, while the Nikkei Stock Average JP:NIK +1.47% gained 1.4% in Tokyo, climbing further from levels it hasn’t seen in more than five years.
Australia’s S&P/ASX 200 AU:XJO +0.54% gained 1.2%, and China’s Shanghai Composite CN:000001 +0.75% edged up 0.3%.
South Korea’s Kospi KR:SEU -0.22% rose 0.1%, less than gains recorded across most of the region, after North Korea on Sunday tested another missile.
The broad advances followed a record finish for the Dow industrials DJIA +0.80% and the S&P 500 SPX +1.03% on Friday as investors cheered upbeat U.S. economic data.
“The share-market rally across the world is putting the ‘don’t chase a rally’ adage to the test, as bourses continue to record territory,” said Perpetual head of investment market research Matthew Sherwood.
“Quality is essential in this market, as prices are distorted, and the foundations [aren’t] strong,” he said.
Among the notable gainers in Tokyo, shares of Sony Corp. JP:6758 +5.67% SNE +1.19% climbed 5.9%, and shipping major Nippon Yusen K.K. JP:9101 +11.32% NPNYY +3.19% soared 10.2%.
The rally in Tokyo came as the Japanese government upgraded its outlook for the domestic economy in a report released Monday.
The stock advance also came even as the U.S. dollar USDJPY -0.29% slipped back below the 103-yen handle that it breached on Friday, though the greenback remained above its levels seen during the previous Japan stock session.
Remarks by Japan’s Economy Minister Akira Amari that further yen weakness could be harmful helped to boost the local currency.
“Japan’s turbo-charged stimulus measures have helped contribute to a solid gross domestic product growth outcome in the first quarter and to the rally in risk assets, but much needs to be done in terms of reforms to help sustain growth,” said Crédit Agricole’s Asia head of global markets research Mitul Kotecha.
Shares of Panasonic Corp. JP:6752 +5.01% PCRFY +2.10% rose 3.9% after the Nikkei newspaper reported the tech firm’s plans to further integrate its Sanyo Electric unit, slashing Sanyo’s remaining workforce by up to 90%.
Shares of Tokyo Electric Power Co. JP:9501 +15.97% TKECF +2.31% spiked 15.2%, with a separate Nikkei report saying Goldman Sachs Group Inc. GS +2.40% plans a large green-energy investment, power from which would go to the utility major.
Most regional energy producers also jumped as U.S. benchmark crude-oil prices climbed back above $96 a barrel.
Inpex Corp. JP:1605 +2.48% IPXHF -4.31% rose 3.5% in Tokyo, and Santos Ltd.AU:STO +1.62% STOSF -3.63% added 2.6% in Sydney.
In Hong Kong, Cnooc Ltd. HK:883 +1.69% CEO +1.68% rose 2.3%, while coal miners China Coal Energy Co. HK:1898 +3.45% CCOZY +0.64% and China Shenhua Energy Co.HK:1088 +3.21% CSUAY +1.85% surged 4% and 4.5%, respectively.
Chinese property developers jumped after data showing average home prices in 70 mainland cities climbed 4.3% in April from the year-ago period, according to The Wall Street Journal’s calculations.
China Overseas Land & Investment Ltd.HK:688 +2.84% CAOVY +0.15% gained 2.8%, and China Resources Land Ltd.HK:1109 +3.73% CRBJF -4.17% climbed 4% in Hong Kong. Likewise, Gemdale Corp.CN:600383 -1.43% added 2.9% in Shanghai, and China Vanke Co. climbed 1.3% in Shenzhen.
Still, some analysts remained concerned that rising property prices could unleash more controls from policy makers in Beijing.
“Ongoing, solid increases in new house prices in China increase the probability of further tightening action by authorities,” said CMC Markets chief market analyst Ric Spooner.
In Sydney, metals stocks advanced after copper futures gained on Friday, even though gold futures moved lower.
Shares of BHP Billiton Ltd. BHP +0.99% AU:BHP +1.10% rose 1.6%, and those of Alumina Ltd. AU:AWC +0.48% AWC +2.78% climbed 3.3%, but gold miner Newcrest Mining Ltd. AU:NCM -0.82% NCMGY -4.76%shed 0.5%.
Westpac Banking Corp. AU:WBC +1.40% WBK -0.66% advanced 1.5%, even as the lender cut its one-year home loan rate after other banks trimmed their own rates in the wake of central-bank easing earlier this month.
In Seoul, some shipbuilding and construction stocks retreated to pressure the broader market. Shares of GS Engineering & Construction Corp. KR:006360 -1.93% shed 1% and Hanjin Shipping Holdings Co. KR:117930 -1.61% fell 1.5%.
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