Wed, 12 May 2021

Chinese economic recovery propels stocks in Asia higher

Lola Evans
16 Apr 2021, 17:26 GMT+10

SYDNEY, NSW, Australia - An astonishing 18.30 percent GDP growth in the fourth quarter in China drove Asian stock markets higher on Friday.

The Chinese announcement followed the release of strong economic data in the U.S. overnight.

"Markets look ahead to economic normalisation as vaccines will go around. Stock prices are likely to rise gradually while looking at upcoming earnings," Tomo Kinoshita, global market strategist at Invesco Asset Management in Tokyo told Reuters Thomson Friday.

Despite the optimistic outlook, the already-stretched indices were only able to manage modest gains.

In Japan, the Nikkei 225 finished ahead 40.68 points or 0.14 percent on Friday, at 29,683.37.

China's Shanghai Composite added 27.63 points or 0.81 percent to 3,426.62.

The Australian All Ordinaries finished flat on Friday, gaining just 0.80 of a single point or 0.01 percent to 7,318.30.

The Hang Seng in Hong advanced 176.57 points or 0.61 percent to 28,969.71.

The U.S. dollar surprisingly moved higher in the Asian zone. The euro retreated to 1.1966 by close in Sydney Friday. The British pound trimmed recent gains to 1.3736. The Japanese yen weakened to 108.88. The Canadian dollar advanced slightly to 1.2523. The Australian dollar fell to 0.7735. The New Zealand dollar eased to 0.7156. The Swiss franc, going against the trend, firmed to 0.9206.

Overnight on Wall Street, the Dow Jones industrials and the Standard and Poor's 500 both closed at new record highs. The Nasdaq on the day did even better rising by more than both other indices.

"Demand is booming right now. Fed officials up to now have said they expect this boost in demand to be fleeting, and will not consider changes in policy until the labor market is at full employment and price levels increase at a sustained pace," Chris Low, Chief Economist at FHN Financial in New York told Reuters Thomson Thursday. "Their resolve will be tested in the next couple of months."

The Dow Jones jumped 305.10 points or 0.90 percent to 34,035.99.

The Standard and Poor's 500 added 45.76 points or 1.11 percent to 4,170.42.

The Nasdaq Composite climbed 180.92 points or 1.31 percent to 14,038.76.

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