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 /zigman2/quotes/210597971/delayed JP:NIK +0.72% gained 0.7% and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.99% edged up 0.5%. The Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +2.01% rose 0.4% while the smaller-cap Shenzhen Composite /zigman2/quotes/210598015/delayed CN:399106 +1.28% inched up 0.1%. South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +0.80% advanced 0.7% and Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +0.42% gained 1.4%. Benchmark indexes in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 +0.88% , Singapore /zigman2/quotes/210597985/delayed SG:STI +0.62% and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX +0.14% 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. /zigman2/quotes/207303954/delayed JP:9984 +2.63% 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.
On Friday, the Dow /zigman2/quotes/210598065/realtime DJIA +0.36% rose 61 points, or less than 0.3%, to 23,685.42, while the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.45% added 11.20 points, or 0.4%, higher to end the session at 2,863.70. The Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP 0.00% 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 was last above $30 a barrel. July Brent crude , the global benchmark, gained more than 3%.
The dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0140% gained to 107.12 yen from Friday’s 107.08 yen.