Asian Stocks Rise on Wall Street Rally Optimism

TOKYO (AP) Asian stocks were mostly higher Monday after a rally on Wall Street, driven by reports showing inflation was easing, easing fears of the threat of a recession.

The Japanese benchmark Nikkei 225 rose 1.7% during afternoon trading to 33,753.33 points. Australia’s S&P/ASX 200 added 0.6% to 7,248.10. The South Korean Kospi rose 1.4% to 2,599.62. The Hang Seng in Hong Kong rose 2.1% to 19,305.10, while the Shanghai Composite gained 1.3% to 3,242.41.

Asia is entering the new half with a growing sense of optimism, with low volatility propelling markets on the back of a surprisingly strong US economic data set that has swept recession concerns, Stephen Innes, managing partner at SPI Asset Management, said in a report.

The quarterly tankan report on business sentiment, prepared by the Bank of Japan, showed an improvement from June last year for the fifth consecutive quarter, with the key indicator rising 3 points to plus 23.

Wall Street ended a winning week last week, with the S&P 500 rising 1.2% to 4,450.38, its highest level since April 2022. The Dow Jones Industrial Average rose 0.8% to 34,407.60 and the Nasdaq index increased by 1.4% to 13,787.92.

Trading in the US is closed for half a day on Monday and all day on Tuesday for Independence Day.

Investors are hoping that the price hikes will slow down enough for the Federal Reserve to halt rate hikes soon. That would mean less pressure on the US economy and global financial markets.

The Fed has already raised interest rates by a massive 5 percentage points from near zero at the beginning of last year. Traders on Wall Street have reversed bets that the Fed will raise rates twice this year, with the majority betting that the federal funds rate will be just 0.25 percentage points higher by the end of 2023, according to data from CME Group. .

Bond market yields fell Friday after the release of economic data. The yield on 10-year government bonds fell from nearly 3.87% just before the reports were released to 3.82%. It helps set rates for mortgages and other important loans.

The S&P 500 closed its sixth winning week of its last seven in June and its best month since October. The index’s gains of nearly 16% in the first six months of the year are better than in 16 of the last 23 full years.

In energy trading, US crude fell 28 cents to $70.36 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, lost 25 cents to $75.16 a barrel.

In currency trading, the US dollar rose from 144.30 yen to 144.70 Japanese yen. The euro was priced at $1.0891, down from $1.0924.

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