Asian stocks advanced on Monday, with upbeat economic data from the United States and Europe and progress on a US infrastructure spending bill boosting sentiment.
The latest batch of manufacturing reports from the region proved to be a mixed bag.
Chinese shares posted strong gains as authorities moved to soothe fears about a crackdown on technology companies and a top decision-making body of the ruling Communist Party said China will maintain stable macro policies in the second half of the year to ensure growth.
China’s Shanghai Composite index climbed 66.93 points, or 1.97 per cent, to 3,464.29, while Hong Kong’s Hang Seng index ended up 274.77 points, or 1.06 per cent, at 26,235.80.
The gains came even as data showed China’s factory activity expanded at a slower pace in July, adding to concerns of a slowdown in the world’s second-biggest economy.
The official purchasing managers’ index fell to 50.4 in July, from 50.9 in June, while the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) dropped to 50.3 last month, from 51.3 in June, marking the lowest level in 15 months.
Japanese shares rallied as focus shifted to corporate earnings from big companies due this week.
The Nikkei average jumped 497.43 points, or 1.82 per cent, to 27,781.02, while the broader Topix index settled 2.05 per cent higher at 1,940.05.
Toyota, Sony, Nintendo and Toyota Motor rose between 1.5 per cent and 2.3 per cent ahead of their earnings reports due this week. Mitsubishi Heavy Industries gained 0.6 per cent after saying it returned to profitability in the April-June fiscal first quarter.
The manufacturing sector in Japan expanded at a faster pace in July, the latest survey from Jibun Bank showed today with a manufacturing PMI score of 53.0, up from 52.4 in June.
Australian markets hit a record high, led by technology stocks. The benchmark S&P/ASX 200 index inched up 98.80 points, or 1.34 per cent, to settle at 7,491.40, while the broader All Ordinaries index ended up 96.30 points, or 1.26 per cent, at 7,760.50.
Afterpay jumped nearly 19 per cent as US-based Square Inc agreed to buy the ‘buy now, pay later’ firm for 29 billion dollars in an all-stock deal. Zip Co shares also surged 9 per cent and Sezzle rallied 3.7 per cent.
Energy firm Oil Search soared 4.7 per cent after it agreed to an improved all-share offer from Santos. The big four banks all rose around 2 per cent while miners Fortescue Metals Group and Mineral Resources lost 2 per cent and 4.4 per cent, respectively on weak metal prices.
In economic news, the manufacturing sector in Australia continued to expand in July, albeit at a slower pace, the latest surveys from Markit Economics and the Australian Industry Group showed.
Seoul stocks rebounded as strong economic data fuelled optimism for a quick economic rebound from the pandemic. The benchmark Kospi gained 20.72 points, or 0.65 per cent, to close at 3,223.04 after data showed South Korea’s July exports jumped 29.6 per cent year-on-year to a record high amid high demand for chips and biohealth products.
Investors shrugged off survey results from Markit Economics showing that the manufacturing sector in the country expanded at a slower pace in July. Market heavyweight Samsung Electronics gained 1 per cent, leading chemical firm LG Chem advanced 2.6 per cent and No 2 chipmaker SK Hynix added 3.1 per cent.
New Zealand shares ended notably higher despite declines on Wall Street Friday and the release of weak Chinese data. The benchmark NX-50 index rose 108.45 points, or 0.86 per cent, to close at 12,702.97.
Power generator and retailer Genesis Energy fell 1.6 per cent after an unfavourable arbitration decision in a dispute with Australian gas supplier Beach Energy.
US stocks fell on Friday, with concerns about China’s clampdown on technology businesses, disappointing results from Amazon and renewed worries about a rise of cases of the Delta variant coronavirus weighing on markets.
The Dow dropped 0.4 per cent, the technology-heavy Nasdaq Composite shed 0.7 per cent and the S&P 500 eased half a per cent.