Australia shares climb 1%, Asian market gains in the US

Australian stocks climbed on Wednesday, tracking U.S. stock markets’ rise to all-time closing highs on Tuesday, but some other Asia markets stumbled.

Australia’s ASX 200 rose 1 percent, with most sectors trading up. The heavily-weighted financial sector was up 1.18 percent, while the energy and materials sectors tacked on 0.56 percent and 1.72 percent, respectively. The Australian dollar jumped to $0.7425, climbing from levels near $0.7320 earlier in the week.

Analysts said the Aussie market’s momentum would be driven by commodity prices. “(The) market appears to be in a capitulation phase for commodity bears,” said Ric Spooner, chief market analyst at spreadbettor CMC Markets, in a note.

“The consensus view is swinging towards commodity prices maintaining higher levels based on continued demand from China and improved U.S. demand,” Spooner said.

Major mining stocks were up more than 2 percent each, with shares of Rio Tinto up 2.34 percent, Fortescue higher by 2.53 percent and BHP Billiton adding 2.81 percent.

Among other regional markets, in New Zealand, the NZX 50 was up 0.32 percent, while in South Korea, the Kospi rose 0.61 percent. Hong Kong’s Hang Seng index was up 0.35 percent, while Chinese mainland shares traded mixed. The Shanghai composite was up 0.13 percent, while the Shenzhen composite slipped 0.1 percent. Japanese markets were closed Wednesday for the Labor Thanksgiving public holiday.

The session in Asia followed record high finishes on Tuesday in the U.S., and analysts expect the positive momentum in stocks to last in the near term.

“The current state of play is the bulls have got control here and that U.S. equity and many other developed markets are going higher, at least in the short-term,” Chris Weston, chief market strategist at spreadbettor IG, said in a note on Wednesday.

The S&P 500 index closed over 2,200 for the first time, finishing up 4.76 points, or 0.22 percent, at 2,202.94. The Dow Jones industrial average hit 19,000 for the first time ever, advancing 67.18 points, or 0.35 percent, to end at 19,023.85, while the Nasdaq gained 17.49 points, or 0.33 percent, to end at 5,386.35.

In the broader currency market, the dollar traded at 100.99 against a basket of currencies at 10:37 a.m. HK/SIN, similar to levels on Tuesday afternoon in Asia, but a tad below its last close at 101.04. The yen traded at 111.05 against the dollar, falling from levels below 110 in the previous week. The euro was at $1.0622 and the pound fetched $1.2419.

“Don’t be mistaken by the mixed performance of the U.S. dollar today, because dollar bulls remain in control,” noted Kathy Lien, managing director of foreign exchange strategy at BK Asset Management in a note.

In company news, Reuters reported, citing South Korea’s Yonhap News, prosecutors raided the offices of Samsung Group over its alleged link with Choi Soon-sil, who is a longtime confidant of President Park Geun-hye and who has been indicted for criminal acts.

Samsung Electronics shares were up 1 percent at 1,655,000 Korean won a share, while Samsung SDI was higher by 0.1 percent. Samsung Electro-Mechanics was down 0.7 percent and Samsung C&T was off 2.1 percent. Samsung Engineering traded flat.

Oil prices were modestly lower during Asian hours, following a flat finish on Tuesday and a more than 4 percent jump on Monday on renewed expectations for the world’s largest oil producers to cut supply when they meet next week.

U.S. crude traded down 0.08 percent at $47.99 a barrel, following an overnight drop of 0.44 percent. Global benchmark Brent was flat at $49.11, after gaining 0.45 percent during the U.S. session.

Jeffrey Halley, a senior market analyst at OANDA, said in a note the market was unwilling to push oil prices toward $50 a barrel ahead of the Thanksgiving holiday in the U.S.

“Their reticence is understandable given that longs put on above that level have not ended well in recent times,” he said, adding inventory numbers from the U.S. Energy Information Administration (EIA) due later in the global day would be watched by traders.

Source: CNBC