Asian markets advanced in early trading Monday, as U.S. stock futures gained after comments from Fed chief Jerome Powell and crude oil prices rose toward a two-month high.
Japan’s Nikkei
NIK,
+0.48%
gained 0.7% and Hong Kong’s Hang Seng Index
HSI,
+0.57%
edged up 0.5%. The Shanghai Composite
SHCOMP,
+0.24%
rose 0.4% while the smaller-cap Shenzhen Composite
399106,
-0.42%
inched up 0.1%. South Korea’s Kospi
180721,
+0.51%
advanced 0.7% and Australia’s S&P/ASX 200
XJO,
+1.03%
gained 1.4%. Benchmark indexes in Taiwan
Y9999,
-0.68%
, Singapore
STI,
+0.90%
and Indonesia
JAKIDX,
+0.07%
were mixed.
Data showed Monday that Japan sank into recession in the first quarter of 2020, and that the current quarter is expected to be worse. Japan’s economy shrank 3.4% year-over-year in the January-March period, according to the Wall Street Journal, after a 7.3% decline in the previous quarter due to a sales-tax increase. While that was not as bad as the 4.8% pullback expected by economists, the second quarter is expected to shrink by 20% or more, due to the coronavirus state of emergency imposed in April.
Japanese conglomerate SoftBank Group Corp.
9984,
+1.02%
said Alibaba co-founder Jack Ma has resigned from its board of directors, and announced the approval of $4.7 billion in stock buybacks.
U.S. Federal Reserve Chairman Jerome Powell told “60 Minutes” on Sunday that the central bank has plenty of ammunition to fight the recession caused by coronavirus-related shutdowns, though he predicted tough times ahead, with the economy contracting more than 30% in the second quarter and unemployment hitting up to 25%.
But Powell said he expects a relatively quick rebound. “You wouldn’t want to bet against the American economy,” he said, noting that a recovery could stretch through next year.
Stock index futures climbed Sunday night, with Dow Jones Industrial Average futures
YM00,
+1.60%
up nearly 300 points following Powell’s interview.
On Friday, the Dow
DJIA,
+0.25%
rose 61 points, or less than 0.3%, to 23,685.42, while the S&P 500
SPX,
+0.39%
added 11.20 points, or 0.4%, higher to end the session at 2,863.70. The Nasdaq Composite Index
COMP,
+0.79%
closed at 9,014.56 after gaining 70.84 points, or 0.8%. Still, all three indexes finished the week lower, with the Dow down 2.7%, the S&P 500 losing 2.3% and the Nasdaq 1.2% lower.
Late Sunday, U.S. crude oil prices continued rising toward a two-month high as the global balance of supply and demand starts to right itself. After rising about 19% last week, West Texas Intermediate crude for June delivery
CLM20,
+5.64%
was last above $30 a barrel. July Brent crude
BRNN20,
+4.15%
, the global benchmark, gained more than 3%.
The dollar
USDJPY,
+0.17%
gained to 107.12 yen from Friday’s 107.08 yen.
