By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Asian markets tracked a solid lead from Wall Street to rally on Wednesday, with Japanese stocks climbing amid expectations for improved earnings growth while Australian shares gained as quarterly inflation data raised hopes for another rate cut.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.43% soared 2.3%, Taiwan’s Taiex rose 1% and South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.33% climbed 0.9%.
The Shanghai Composite /zigman2/quotes/206600939/delayed CN:000001 +1.02% finished 1.6% higher after a tentative start and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -0.69% advanced 1.7%, with both staging a rebound after suffering steep losses in the wake of HSBC data Tuesday, showing that Chinese manufacturing activity cooled in April.
Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +0.68% rose 1.7% for its fourth straight day of advance, after data showing consumer prices rose by a weaker-than-expected 2.5% in the first quarter from the year-ago period.
“Inflation is not an issue and is certainly not a barrier to further easing. It should see the Reserve Bank of Australia act on its easing bias, and cut interest rates another 0.25%, hopefully at its May board meeting,” said Shane Oliver, head of investment strategy at AMP Capital.
Shares of Commonwealth Bank of Australia /zigman2/quotes/200638713/delayed AU:CBA +0.01% /zigman2/quotes/207018701/delayed CBAUF +1.71% climbed 2.4% and Australia & New Zealand Banking Group /zigman2/quotes/205482049/delayed AU:ANZ +1.03% /zigman2/quotes/203732563/delayed ANZBY +0.75% added 2.2% after the data, while retailer Woolworths Ltd. /zigman2/quotes/209906204/delayed AU:WOW -0.23% gained 2.3%.
The region’s strong gains came after stocks on Wall Street ended higher, overcoming a sharp intraday fall in the wake of a rogue tweet from a hacked Associated Press account.
Shares of Apple Inc. slipped in after-hours trading as investors focused on the company’s lower quarterly margins, despite a profit that beat estimates and the iPhone maker’s decision to return an additional $50 billion to shareholders via a share-buyback program. Read full story on Apple earnings.
Apple calms fears with earnings report
Apple Inc. reported a drop in its fiscal second-quarter earnings on Tuesday afternoon, but the results were ahead of Wall Street's expectations. WSJ's Jessica Lessin reports. (Photo: Getty Images)
Apple’s component suppliers and mobile service providers in Asia traded broadly higher on Wednesday after the company’s results. Hon Hai Precision Industry Co. /zigman2/quotes/205366389/delayed HNHAF +8.74% /zigman2/quotes/207256514/delayed TW:2317 +1.41% rose 2.5% and Largan Precision Co. /zigman2/quotes/210444196/delayed TW:3008 +6.80% added 1.4% in Taipei. Among Apple’s mobile service providing partners, Softbank Corp. /zigman2/quotes/207303954/delayed JP:9984 -0.68% /zigman2/quotes/207137761/delayed SFTBY -1.43% rose 4.2% in Tokyo and China Unicom Hong Kong Ltd. /zigman2/quotes/205476740/composite CHU -3.30% /zigman2/quotes/205091392/delayed HK:762 -1.79% gained 2.7%.
Automobile shares posted strong gains in Tokyo amid hopes that a weakened yen would boost their profitability, with Nissan Motor Co. /zigman2/quotes/207656007/delayed NSANY -1.64% /zigman2/quotes/208298710/delayed JP:7201 -2.14% climbing 2.3% and Mazda Motor Corp. /zigman2/quotes/206326885/delayed MZDAY -3.10% /zigman2/quotes/204777714/delayed JP:7261 -3.05% rising 3.6%.
Subaru maker Fuji Heavy Industries Ltd. /zigman2/quotes/200526066/delayed FUJHY -1.55% /zigman2/quotes/203522406/delayed JP:7270 -1.83% jumped 2.7% and Hino Motors Ltd. /zigman2/quotes/207652388/delayed HINOY +13.07% /zigman2/quotes/209422954/delayed JP:7205 +3.04% climbed 3.8% after the Nikkei newspaper reported that both firms were likely to post their best operating profits on record after the yen’s recent decline.
The rebound in Chinese equities came after an executive at Goldman Sachs Asset Management said stocks were turning attractive after a drop in valuations and as corporate profits were poised to level out.
In Hong Kong, shares of HSBC Holdings PLC /zigman2/quotes/202687335/delayed HK:5 -1.33% rose 2.4% a day after the banking heavyweight said it will cut 1,149 jobs in Britain as part of plans to reduce costs.