Asian shares lifted by Wall Street rally, Nikkei falls back

A currency trader watches the market at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea. Photo: Ahn Young-joon, AP

SEOUL, South Korea—Asian shares tracked an overnight rally on Wall Street, though Japan’s Nikkei 225 index ceded early gains as the yen rose against the US dollar.

Japan’s Nikkei 225 lost 0.7 percent to 21,244.68 after gaining more than 1.0 percent earlier in the day. Hong Kong’s Hang Seng index added 1.4 percent to 29,884.06 and the Shanghai Composite Index advanced 1.0 percent to 3,185.86. South Korea’s Kospi rose 1.1 percent to 2,395.19. Australia’s S&P/ASX 200 rose 0.6 percent to 5,855.90. Share benchmarks in Southeast Asia and New Zealand were all higher.

US stocks finished higher on Monday. The Standard & Poor’s 500, the benchmark for many index funds, gained 1.4 percent to 2,656. The Dow climbed 1.7 percent to 24,601.27 and the Nasdaq composite advanced 1.6 percent to 6,981.96. The Russell 2000 index of smaller-company stocks rose 0.9 percent to 1,490.98.

Investors remain wary of turbulence. It took just nine days for stocks to plunge 10 percent from their latest peak, which was reached on January 26. A drop of that size is known on Wall Street as a market “correction.” According to LPL Financial, it was the swiftest move from a record high to a correction in the history of the S&P 500. The index rose 1.5 percent last Friday but still wound up with its worst weekly loss in more than two years.

A key question is whether the correction has already hit bottom, said Jingyi Pan, a market strategist at IG.

“Nevertheless, the worst is likely not over for this week for the simple reason that we have US CPI sitting as a mammoth event risk this week,” Pan said, referring to the Wednesday release of US consumer price index data for January.

Turning Points 2018
Suntrust banner2