Asian stocks follow Wall St higher ahead of earnings reports

AP Business

A currency trader walks by the screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea, Monday, July 12, 2021. Asian stock markets rose Monday after Wall Street hit a high despite jitters about the spread of the coronavirus’s delta variant as investors looked ahead to U.S. earnings reports. (AP Photo/Lee Jin-man)

BEIJING (AP) — Asian stocks followed Wall Street higher on Tuesday ahead of U.S. earnings reports that are expected to show strong profits for major banks.

Shanghai, Tokyo, Hong Kong and Sydney advanced.

Overnight, Wall Street’s benchmark S&P 500 index rose 0.3% to a new high, led by banks, communications and consumer-oriented stocks.

“Wall Street is bracing for a volatile week as market participants are divided on a bevy of issues that include whether to bet on growth or cyclicals and if inflation acceleration intensifies,” said Edward Moya of Oanda in a report.

The Shanghai Composite Index rose 0.3% to 3,559.96 and the Nikkei 225 in Tokyo gained 0.8% to 28,807.95. The Hang Seng in Hong Kong added 1.8% to 27,999.08.

The Kospi in Seoul advanced 0.7% to 3,270.89 and Sydney’s S&P-ASX 200 was 0.4% higher at 7,361.90.

New Zealand and Singapore gained while Bangkok and Jakarta retreated.

Investors were awaiting trade data from China.

On Wall Street, the S&P rose to 4,384.63. The Dow Jones Industrial Average added 0.4% to 34,996.18. The Nasdaq composite gained 0.2% to 14,733.24.

The indexes have hit multiple highs lately in choppy trading.

Expectations for corporate profits are high as companies release quarterly results, led by Wall Street banks on Tuesday.

Corporate earnings are expected to surge 64% from a year earlier, according to FactSet. That would be the biggest year-over-year growth since 2009 in the aftermath of the global financial crisis.

Stocks have risen sharply in the past year on expectations that corporate profits would rebound once the pandemic ends. Without strong profits, it will be increasingly difficult for investors to justify these high stock prices and record market valuations.

In energy markets, benchmark U.S. crude rose 13 cents to $74.23 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 46 cents on Monday to $74.10. Brent crude, the price basis for international oils, added 10 cents to $75.26 per barrel in London. It 39 cents the previous session to $75.16 a barrel.

The dollar gained to 110.37 yen from 110.34 yen. The euro advanced to $1.1871 from $1.1858.

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