Stock market today: Asian shares advance following Wall Street rally led by technology stocks
BANGKOK (AP) — Asian shares advanced Tuesday after Wall Street rallied to claw back almost all the losses from its slow start to the year.
U.S. futures fell while oil prices saw modest gains.
Tokyo’s Nikkei 225 index gained 1.4%, to 33,858.63, as the market reopened from a holiday on Monday.
Hong Kong’s Hang Seng added 0.6% to 23,321.52, regaining some ground lost in recent declines. The Shanghai Composite index rose 0.4% to 2,897.62.
South Korea’s Kospi picked up 0.4% to 2,577.12, while the S&P/ASX 200 in Australia jumped 1.1% to 7,532.60.
On Monday, Wall Street saw broad gains as easing Treasury yields relaxed pressure on the stock market. The rally was led by Big Tech stocks, the main driver of Wall Street’s big advance last year, when excitement around artificial-intelligence technology made just a handful responsible for most of the S&P 500’s returns. But they stumbled last week as markets broadly regressed.
The S&P 500 jumped 1.4% to 4,763.54. It is back within 0.7% of its record and has regained momentum after logging its first losing week in the last 10.
The Nasdaq composite shot 2.2% higher, to 14,843.77, while the Dow Jones Industrial Average lagged the market with a gain of 0.6%, to 37,683.01.
Boeing dragged on the Dow in its first trading after one of its jets suffered an inflight blowout over Oregon. It fell 8%. Spirit AeroSystems, which builds fuselages and other parts for Boeing, lost 11.1%.
Stocks of oil-and-gas companies were also heavy weights after Saudi Arabia gave indications of potentially weak demand for crude, cutting prices of its oil for February delivery. Exxon Mobil fell 1.7%, and Marathon Oil lost 2.7% as a barrel of U.S. crude tumbled $3.04 to $70.77.
“Weak demand fundamentals influenced this decision in the global physical oil market. While the price cuts were widely anticipated, they turned out to be larger than analysts had forecasted,” Stephen Innes of SPI Asset Management said in a commentary.
Nvidia rose 6.4% after announcing several AI-related products. Apple, meanwhile, rose 2.4% to bounce back from its worst week since September. They were the strongest forces lifting the S&P 500, along with Microsoft, Amazon and Alphabet.
Commercial Metals also jumped 7.5% after reporting stronger profit for the latest quarter than analysts expected. It said construction activity is healthy in North America, driving demand for steel and helping to offset weaker conditions in Europe.
More earnings results will be arriving at the end of the week. Delta Air Lines, JPMorgan Chase and UnitedHealth Group will be among the companies kicking off the S&P 500’s reporting season on Friday for the final three months of 2023.
The highlight of the week may be Thursday’s release of the latest inflation data for U.S. consumers. A cooldown there has ignited hope on Wall Street that the Federal Reserve will soon see enough improvement to not only halt its hikes to interest rates but to begin cutting them.
The Fed has already hiked its main interest rate to the highest level since 2001, which grinds down on the economy and hurts prices for investments, in hopes of conquering high inflation.
Treasury yields have already sunk in the bond market on such expectations, and they edged lower Monday. The yield on the 10-year Treasury fell to 4.01% from 4.05% late Friday. It was above 5% in October, at its highest point since 2007 and putting sharp downward pressure on the stock market.
Critics also warn traders may be too optimistic about how deeply the Federal Reserve may cut rates this year. The Fed has indicated a potential for three cuts, but many traders are anticipating at least six. That large a number may not be likely unless a recession forces the Fed’s hand, critics say.
That’s why much focus is on corporate profits, where growth could help prop up stock prices.
U.S. benchmark crude oil added 26 cents to $71.03 a barrel in electronic trading on the New York Mercantile Exchange. It lost $2.84 to $70.77 a barrel on Monday.
Brent crude oil, the international standard, gained 39 cents to $76.51 a barrel.
The U.S. dollar slipped to 143.59 Japanese yen from 144.23 yen. The euro rose to $1.0964 from $1.0949.
AP Business Writer Stan Choe contributed.