Asian stocks extended gains on Friday thanks to Wall Street scoring all-time highs, as investors gravitated to the view that the latest exchange of tariffs between the US and China might be less damaging than initially feared.
A rally in Chinese markets helped lift the MSCI’s broadest index of Asia-Pacific shares outside Japan 1.15 percent, buoyed in part by expectations that Beijing will pump more stimulus into its economy to weather the trade war.
The MSCI index has rebounded 4.6 percent from a 14-month low on Sept. 12.
The weighted index on the Taiwan Stock Exchange closed up 141 points, or 1.3 percent, at the day’s high of 10,972.41. The TAIEX rose 1 percent from last week’s 10,868.14 points.
Shares of China’s consumer goods companies climbed on expectations of rising sales after China’s State Council issued guidelines to boost the country’s consumption potential.
An index tracking major consumer firms rose 1.76 percent.
China hopes the US will show sincerity and take steps to correct its behavior, the Chinese Ministry of Commerce said on Thursday, after both countries slapped new tariffs on each other’s goods this week in an escalating trade war.
The administration of US President Donald Trump imposed sanctions on the Chinese military for buying fighter jets and missile systems from Russia in contravention of a sweeping US sanctions law.
In Japan, the TOPIX roared back to life, capping a gain of 4.4 percent in a four-day week, even as the US and China pressed ahead with additional tariffs on each other’s goods.
Japan’s rally followed a large selloff by foreign investors that had made the benchmark gauge one of the worst performers among developed markets this year.
In another sign of how bearish things have been, short selling has accounted for more than 40 percent of trading on the Tokyo Stock Exchange for much of this year.
As of Friday, the TOPIX was down less than 1 percent year-to-date, paring a drop of more than 8 percent as of March.
The Nikkei 225 Stock Average has already moved back into the green, up 4.9 percent for this year to about 23,870.
Martin Malone of Mint Partners in London predicted the blue chip measure will reach 26,500 by Christmas, while Ryoji Musha of Musha Research Co in Tokyo targets 27,000 by the end of the year.
Hong Kong’s Hang Seng Index on Friday advanced 1.7 percent to 27,953.58, up 2.4 percent for the week.
The Shanghai Composite Index on Friday rose 2.5 percent on Friday, rising 4.3 percent for the week.
Australia’s S&P/ASX 200 Index on Friday gained 0.4 percent and rose 0.5 from last week.
Additional reporting by staff writer, with CNA
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