Asian stocks rise after Wall St breaks string of falls

Asian stocks rise after Wall St breaks string of falls

Asian stocks rose on Monday after Wall Street recovered from a seven-week run of declines and China eased anti-virus restrictions on trading in Shanghai and Beijing. Shanghai, Tokyo, Hong Kong and Sydney advanced. Oil remained above $110 a barrel.

On Wall Street, the benchmark S&P 500 index ended Friday up 6.6%, its biggest weekly gain in 18 months, after inflation eased in April. US markets will be closed on Monday for a holiday.

“Markets rallied over the long weekend, providing a positive tone at the start of this week,” ING economists said in a report.

The Shanghai Composite Index advanced 0.5% to 3,145.77 after more factories and stores were allowed to reopen in Beijing and Shanghai. Shanghai, China’s commercial capital, announced tax breaks and subsidies to help businesses recover from a two-month lockdown. Tokyo’s Nikkei 225 rose 2.3% to 27,382.03 and Hong Kong’s Hang Seng gained 1.9% to 21,093.21. South Korea’s Kospi rose 1.2% to 2,668.31.

Sydney’s S & P-ASX 200 rose 1.4% to 7,2890.10.

India’s Sensex opened down 2.1% at 56,025.84. New Zealand and Singapore gained while Indonesia fell back. On Wall Street, the S&P 500 rose 2.5% on Friday to 4,158.24, buoyed by gains at tech companies.

Investors were relieved after Commerce Department data showed US inflation, which has prompted the Federal Reserve to raise interest rates, slowed to 6.3% from a year earlier in April, its first drop in 17 months. Markets are concerned about whether the Fed can control inflation, which is at its highest level in four decades, without pushing the world’s largest economy into recession.

The Dow Jones Industrial Average rose 1.8% to 33,212.96. The Nasdaq, dominated by technology stocks, gained 3.3% to 12,131.13.

The US market has tanked for the past two months on fears over interest rate hikes that could slow economic activity and the impact of Russia’s war in Ukraine and China’s economic slowdown. Crude prices have risen nearly 60% this year on fears of supply disruptions from Russia, the world’s second-largest exporter. Wheat prices have risen by 50% and corn prices by 30%. Disruptions to manufacturing and trade due to China’s closure of Shanghai and other industrial cities to combat virus outbreaks have also added to inflationary pressures.

More factories, shops and other businesses may reopen this week in Shanghai and the Chinese capital Beijing after authorities declared the outbreaks under control. The Shanghai city government has promised tax and rent cuts, faster approvals for construction projects and more subsidies for the purchase of electric cars. In energy markets, benchmark US crude rose 88 cents to $115.95 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the basis for international oil prices, rose 79 cents to $116.35 a barrel in London.

The dollar fell to 127.03 yen from 127.10 yen on Friday. The euro rose to $1.0755 from $1.0733.

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