HONG KONG, RAW – Asian shares have risen as the Chinese market returned from a one-week holiday upbeat, tracking a global rally, while investors also eyed key US jobs data for fresh insight into the timing of Federal Reserve tapering.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5 per cent, after rallying 2.1 per cent the day before, its biggest daily gain since August. Japan’s Nikkei index advanced 1.8 per cent.
Chinese blue chips gained 0.56 per cent as they resumed trading after being closed for the National Day holiday, while Hong Kong – which has been open all week – gained one per cent.
Elsewhere, Australian shares rose 0.84 per cent helped by mining stocks amid surging commodities prices.
Over the past three months, Chinese shares have been battered by regulatory changes, turmoil in the property sector, and more recently a power crunch, but some investors are now starting to see a buying opportunity.
“The debate on China is shifting a bit away from being very negative. People are asking, ‘Is there a way beyond the regulatory uncertainty? How much of this is reflected in prices?’,” said Herald van der Linde, Asia Pacific head of equity strategy at HSBC.
“We’re neutral, we tell people not to be too negative because valuations are low.”
The focus remains on the property market as investors wait to see whether regulators take action to contain the contagion from cash-strapped Evergrande’s debt problems.
US futures rose 0.16 per cent after the Senate approved legislation to temporarily raise the federal government’s $US28.4 trillion debt limit and avoid the risk of a default later this month.
Overnight on Wall Street, the Dow Jones Industrial Average gained 0.98 per cent, the S&P 500 rose 0.83 per cent and the Nasdaq Composite moved up 1.05 per cent.
Investors are also keeping an eye on US employment data for September due later on Friday.
They expect employment figures that are near consensus will lead the Federal Reserve to indicate at its November meeting when it will begin tapering its massive stimulus program.
US Treasury yields rose ahead of those figures, with volatility at the shortest end of the curve easing as the plan emerged to avoid a default on government debt.
In Asian hours, the benchmark 10-year US Treasury yield rose 1.6 basis points to 1.58887 per cent, its highest since June when it touched 1.594 per cent.
In currency markets, the US dollar index, which measures the greenback against a basket of its peers, was little changed at 94.206, not too far from a 12-month high of 94.504 hit in late September.
CBA analysts said it was possible the jobs data could surprise investors by being lower than expected, but, “We think it would take a larger miss than we are anticipating to stop the (Federal Reserve) from announcing a taper in November”.
Oil prices continued to be volatile. Brent crude rose 0.6 per cent to $US82.44 a barrel, while US crude gained 0.78 per cent to $US78.90 a barrel.