Asian stocks bounced back on Monday as worries over the Middle East situation subsided and investors returned to riskier assets.
Gold and the safe-haven US dollar eased back from near their peaks, and crude oil prices declined as the potential for a major supply disruption waned.
Iran said on Friday that it had no plan to retaliate following an apparent Israeli drone attack within its borders, which in turn followed an unprecedented Iranian missile and drone attack on Israel days before.
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Japan’s Nikkei share average rose, recouping some of the previous session’s sharp losses, although declines in chip-related stocks capped gains.
The benchmark index was up 1.00%, or 370.26 points, to close at 37,438.61, while the broader Topix was ahead 1.38%, or 36.14 points, to 2,662.46.
Chip-making equipment maker Tokyo Electron closed 3.22% lower, although it recouped some early losses. Chip-testing equipment maker Advantest fell 3.92% and chipmaking device supplier Disco slipped 4.38%. Chip-maker Renesas Electronics fell 3.3%.
On Friday, the index fell 2.66% in its worst session in more than a year and a half, amid worries over an escalation in the Middle East conflict.
Hong Kong stocks extended their gains after China’s market regulator unveiled a series of market reforms aimed at boosting confidence in the city’s status as a financial hub, with sentiment getting a boost from the prospect of a bigger investor base following the changes.
The Hang Seng Index gained 1.77%, or 287.55 points, to close at 16,511.69. Topping the volumes list were gaming giant Tencent, which rose as much as 6.1% and food delivery company Meituan which surged 6.3%.
Mainland Chinese blue chips, however, declined 0.18% in their first chance to react to new measures announced on Friday aimed at promoting overseas investment in China’s technology sector.
The Shanghai Composite Index dropped 0.67%, or 20.67 points, to 3,044.60, while the Shenzhen Composite Index on China’s second exchange fell 0.49%, or 8.30 points, to 1,678.26.
Bond Yields Bounce Back
Elsewhere across the region, Indian stocks advanced with Mumbai’s signature Nifty 50 index up 0.57%, or 127.25 points, at 22,274.25.
MSCI’s broadest index of Asia-Pacific shares rose 0.83%, retracing some of the 1.8% drop it suffered on Friday after news of the Israeli strike emerged.
Pan-European STOXX 650 futures added 0.33%, and FTSE futures advanced 0.8%. US stock futures added 0.31%, following a 0.88% drop for the S&P 500 on Friday.
Bond yields – which climb when prices fall – rose back towards multi-month highs. The 10-year US Treasury yield climbed 4 basis points to 4.656%, heading back toward the five-month peak of 4.696% reached last week on the view that the Fed would be in no hurry to ease policy amid robust economic data and sticky inflation.
The dollar index, which measures the currency against six major peers, eased 0.05% to 106.05. It was also at a five-month top last week, at 106.51.
Gold slid 0.95% to $2,367.75, retreating from near the all-time peak of $2,431.29 from last week.
Crude oil fell as traders put the focus back on fundamentals. With a rise in US stockpiles as the backdrop, Brent futures fell 67 cents, or 0.77%, to $86.62 a barrel.
Key figures
Tokyo – Nikkei 225 > UP 1.00% at 37,438.61 (close)
Hong Kong – Hang Seng Index > UP 1.77% at 16,511.69 (close)
Shanghai – Composite < DOWN 0.67% at 3,044.60 (close)
London – FTSE 100 > UP 1.12% at 7,984.57 (0936 BST)
New York – Dow > UP 0.56% at 37,986.40 (Friday close)
- Reuters with additional editing by Sean O’Meara
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