HONG KONG: Hong Kong stocks broke the 30,000 mark for the first time in 10 years on Wednesday as Asian markets extended a global rally following another record close on Wall Street.
After retreating for most of this month, investors were back in buying mood this week on optimism about the world economy and earnings, while they remain upbeat US lawmakers will eventually push through much-vaunted tax cuts.
All three main indexes in New York closed at all-time highs once again as dealers there begin to wind down for the Thanksgiving holiday Thursday.
Tech firms were the big winners, with top titans including Apple, Amazon, Facebook and Google parent Alphabet firming more than one percent.
The positive energy flowed through to Asia, where Hong Kong ploughed 0.8 percent higher in the morning to crack the 30,000 barrier for the first time since November 2007.
The Hang Seng Index has soared by a third this year, boosted by Tencent, which has doubled in value in that period — helping the internet giant surpass half a trillion dollars in market capitalisation and overtaking Facebook.
Across the rest of Asia investors were buoyant, sending Tokyo 0.8 percent higher by the break, Shanghai 0.7 percent up and Sydney 0.5 percent higher.
Seoul and Singapore each rose 0.3 percent, while Taipei put on 0.8 percent. Manila, Jakarta and Wellington were also well up.
– Positive outlook –
“When thinking about the year ahead it does seem to me that given where growth is, where central banks are, where inflation is, and even with many tight labour markets around the world, the best course is to extrapolate this year’s trends into the future. At least until there is a material piece of information that changes,” said Greg McKenna, chief market strategist at AxiTrader.
World markets had taken a step back on concerns that Donald Trump’s tax reform legislation could fall flat as US lawmakers struggle to agree a joint deal.
However, with Republicans continuing to work on a plan that can pass before Christmas, analysts said there remains hope for a breakthrough.
Goldman Sachs has hiked its outlook for US markets next year, saying strong economic growth and tax reform will fire earnings.
“The earnings picture is dominant and that’s of course what has, and will continue, to move markets,” Bob Doll, chief equity strategist at Nuveen Asset Management, told Bloomberg TV.
“Icing on the cake is the tax bill and that does boost earnings but a lot of people are already baking that into their assumption.”
On currency markets the euro stabilised after tanking earlier this week on political uncertainty in Germany — Europe’s biggest economy — after Chancellor Angela Merkel’s talks to form a coalition government failed.
The country’s president spoke to party leaders Tuesday in a last-ditch attempt to avert a crisis.
– Key figures around 0245 GMT –
Tokyo – Nikkei 225: UP 0.8 percent at 22,590.27 (break)
Hong Kong – Hang Seng: UP 0.8 percent at 30,041.52
Shanghai – Composite: UP 0.7 percent at 3,435.74
Euro/dollar: DOWN at $1.1737 from $1.1740 at 2200 GMT
Pound/dollar: UP at $1.3250 from $1.3244
Dollar/yen: DOWN at 112.26 yen from 112.44 yen
Oil – West Texas Intermediate: UP 47 cents at $57.30 per barrel
Oil – Brent North Sea: UP 23 cents at $62.80
New York – DOW: UP 0.7 percent at 23,590.83 (close)
London – FTSE 100: UP 0.3 percent at 7,411.34 (close)
Source: Brecorder.com
